Thoughts about the Time Warner versus Fox battle that could soon leave millions without The Simpsons, American Idol, the Sugar Bowl, and a bunch of other programs:
This might be part of an overall change in distribution philosophy for Fox. Fox continues to try to strong-arm content distributors. Fresh off their dispute with Google, they are trying to hold Time Warner hostage by increasing costs to Brighthouse by an alleged 300 percent.
If Fox was smart, they would pull the plug on Brighthouse’s TV division all together. They would make all of their programming exclusive to sites such as Hulu.com, Youtube, Myspace (which Fox owns) or their individual websites such as FoxNews.com. They could even drive viewers of their shows to each shows’ respective website (GlennBeck.com, Simpsons.com, etc.).
The dilemma is in advertising. So far no one has yet figured out how to make fistfuls of dollars from online advertising. If Fox could drive its advertisers online and get the same income without having to pay the middle man they wouldn’t need Brighthouse. If Fox can pull it off, don’t be surprised to see NBC, CBS, ABC and other cable networks slowly migrating off cable television.
For Time Warner, which recently let AOL go it’s own way, their position is understandable. They have to know paying exorbitant amounts to be the middle man in the media chain is a losing venture. The money from big-money advertisers is moving to online ventures and away from the networks (see Pepsi’s decision to not air a Super Bowl commercial and divert the money to a social media campaign). From Time Warner’s point of view, there is no way they could re-coup value in a mega deal with a media distributor.
However, if Fox fails to get the same advertising dollars, it may make viewers pay for content on its sites. I personally think this won’t work, but Fox could gamble on the loyalty of its viewers and charge for each online viewing of the The Simpsons, 24, American Idol, etc. It may even choose to set up website subscriptions, such as those seen on adult sites. I could definitely see Fox offering $4.95 a month for unlimited online content.
(Side note: charging for Myspace would be the nail in the coffin for the once prosperous social media site. I guarantee having to pay would drive local bands, film makers, and other media creators from Myspace and on to more independent networking sites.)
This is a battle Brighthouse can’t win on the cable front. However, I wouldn’t be surprised if the battle shifted platforms to the Net very, very soon. If Fox were to leave Brighthouse, Time Warner does hold the trump card of Brighthouse’s internet access. Time Warner could block Fox’s websites from their millions of subscribers. This would prevent the average Brighthouse customer from having access to Fox-distributed media on any platform. Fox would definitely lose money as Brighthouse customers would have to decide where their loyalty lay.
I think we could soon see a day where customers choose their cable/internet distributor based on what content they have multi-media deals with. Of course, if unfiltered, completely neutral wi-fi access is eventually free and open as the radio spectrum is now, we would not only avoid this problem, but would see the end of cable television as we know it.