Historically, broadcasters have offered their signal over the air, free to homes. Their revenue came from advertising. Today, they still offer free, over the air, but they also are getting license fees from cable operators. So a site offering to redistribute free content to devices sounds promising for consumers, but problematic to the license fee model. "On Friday, CBS, NBC, ABC and Fox filed a copyright infringement lawsuit against FilmOn.com, which offers subscribers who pay $9.99 a month access to live high definition feeds of TV online. The suit follows a battle with another online streaming outfit ivi, Inc., dual moves that indicate the major broadcast networks are starting to get aggressive in policing the Internet for unauthorized transmissions."
Why let another company make money over your content? Broadcasters may be right in stopping and perhaps should kick themselves for not being more aggressive in bringing their content to online devices. Flo TV is dying, Slingbox is a stopgap solution. Broadcasters have not been proactive in getting their signals seen through wireless connections. FilmOn has simply discovered an opportunity to regain eyeballs for broadcasters. Perhaps better to partner with them instead of sue.
One problem is that online isn't merely an extension of broadcast. It's seen a different medium and revenue stream from broadcast for which all the guilds are demanding separate compensation. If they let someone put their broadcasts online, they become liable to the guilds for new sets of royalties.
ReplyDeleteThe advertisers aren't paying for the online eyeballs because they're not quantified. So, as far as the studios are concerned, they're not making any more money from letting someone rebroadcast their stuff online, but they are creating more costs, because the guilds are going to demand separate royalties for the online feeds.
Also note Warner's recent decision not to put "rental" episodes of their shows on iTunes for 99 cents because they felt it would cannibalize more lucrative online and DVD sales.
Then there's Hulu's tortured negotiations with the entertainment conglomerates that aren't investing in it, such as Warner and Viacom.
It's not easy being a network right now.