As over-the-top offerings from Dish Network, Sony and Verizon Communications move closer to reality, programmers and distributors still appear far apart on the ultimate impact that migrating content to an online model will have on the overall industry.
Dish was expected to be the first out of the box with an OTT product — chairman Charlie Ergen has said he expects to launch his offering around yearend — followed by Sony and Verizon with similar offerings in early 2015. HBO kick-started the OTT conversation in October when it announced plans to offer a direct-to-consumer product in early 2015 — some reports estimate it could come in April, just before the premiere of perennial hit Game of Thrones — and CBS has already launched its broadcast-based CBS All Access service in several markets and is expected to debut a Showtime Networks OTT service some time next year.
But while programmers see OTT as a complementary service that will allow it to tap into new technologies while maintaining the status quo of the cable distribution model, distributors have a different take. While OTT has the potential to have a real impact on subscriber losses — depending on how it is priced and packaged — many see the service as a means of dismantling the practice of bundling popular channels with less-watched ones in carriage agreements.
Recently, Charter Communications CEO Tom Rutledge warned that programmers could be playing with fire concerning OTT, particularly if they dilute the value of the cable distributor's content package with online products.
Rutledge argued that breaking up the bundle in favor of going over-the-top could have a serious impact on advertising revenue, in that it would significantly dilute the number of viewers for their shows.
- See more at:.multichannel.com
Dish was expected to be the first out of the box with an OTT product — chairman Charlie Ergen has said he expects to launch his offering around yearend — followed by Sony and Verizon with similar offerings in early 2015. HBO kick-started the OTT conversation in October when it announced plans to offer a direct-to-consumer product in early 2015 — some reports estimate it could come in April, just before the premiere of perennial hit Game of Thrones — and CBS has already launched its broadcast-based CBS All Access service in several markets and is expected to debut a Showtime Networks OTT service some time next year.
But while programmers see OTT as a complementary service that will allow it to tap into new technologies while maintaining the status quo of the cable distribution model, distributors have a different take. While OTT has the potential to have a real impact on subscriber losses — depending on how it is priced and packaged — many see the service as a means of dismantling the practice of bundling popular channels with less-watched ones in carriage agreements.
Recently, Charter Communications CEO Tom Rutledge warned that programmers could be playing with fire concerning OTT, particularly if they dilute the value of the cable distributor's content package with online products.
Rutledge argued that breaking up the bundle in favor of going over-the-top could have a serious impact on advertising revenue, in that it would significantly dilute the number of viewers for their shows.
- See more at:.multichannel.com
