Inside the TV Wars The battles to watch over what you can watch


Extra! March 2010

Inside the TV Wars

The battles to watch over what you can watch

By Megan Tady
The real fight to watch isn’t on television—Conan vs. Leno, Olbermann vs. O’Reilly. Rather, it’s about television, and the future of online video—a fight that pits cable and content companies against consumers.

Instead of being glued to our favorite shows, we’d be wise to pay attention to the various battles, mergers and backroom deals happening between big media corporations who are trying desperately to cling to a sinking broadcast media model—and pull the public down with them.

Cable and broadcast companies see the writing on the wall, and it no longer spells “media empire.” Although a majority of Americans are still watching television—clocking in an average of five hours of viewing a day (Nielsen Wire, 5/20/09)—people are increasingly switching off the tube and using their computers and laptops to watch their favorite shows, as well as to find alternative programming. Options like TiVo and DVR have given us the blessed ability to skip over advertisements. And advertising companies are jumping ship, heading over to the Internet or simply not placing ads in a market that can no longer guarantee as many eyeballs.

Thanks to the Internet’s open platform, anyone can create and share video, meaning we’re no longer tethered to traditional media gatekeepers who decide what’s entertaining and who gets the spotlight. We’re also realizing that we can cancel our hefty cable subscriptions and still watch the Daily Show online—for free. It’s a Pandora’s box that media corporations are trying to sit on top of while the public wrenches the lid up from below.

These new trends threaten the old media model, and cable and broadcast companies are hatching various plans to keep their stranglehold on content, control and profit—all to the detriment of consumers. If they get their way, we’ll likely see higher prices, fewer choices, worse programming and a slow stifling of online video innovation.

Here are three developments worth paying attention to:

1. Time Warner Cable vs. Fox/News Corp.
The deal long accepted by the TV broadcasters and their affiliates was that they’d get free use of the public airwaves, and in return they’d give the public free programming—making their money by interspersing the shows with ads. With overall ad spending down in a tight economy, the networks have been looking for a new profit model—and enviously eyeing the cable companies’ ability to get audiences to pay money for the privilege of watching ad-filled TV (New York Times, 2/23/07).

2. TV EverywhereThe unrelenting cable bill hikes, of course, only increase the attraction of online video. One way to keep consumers paying for TV content is to put barriers around it—which is exactly what cable, satellite and phone companies are conspiring to do.

3. Comcast/NBCU merger
If you can’t beat them, take them over. That seems to be Comcast’s approach as it positions itself to take a controlling stake in NBC Universal, giving the cable company power over a major television network and film studio, while retaining its perch as the nation’s largest cable company and residential Internet service provider (L.A. Times, 1/29/10). NBCU owns NBC, MSNBC, CNBC, Universal Studios, 27 local television stations and a handful of other properties.Demanding change
This is not to say that all online TV should be free. Or that cable and content companies shouldn’t be thinking about how to stay in business or change with the times. But all three of these recent developments show a disturbing trend toward stagnation and status quo. Forcing customers to retain their rising cable subscriptions in order to watch online TV, colluding to stifle video competition, and holding tight to old media models in which companies peck at each other for more profit (and pass costs down to consumers) means we’re being stuck with a dying dinosaur of a system, and paying a hefty price for it.

Throughout the 20th century, every democratizing revolution in media was co-opted by corporations that squelched its democratic potential in pursuit of profit. Will the same happen with online video and the Internet? Unfortunately, our media monoliths aren’t ready to evolve, and they’re prepared to sabotage content, creativity and innovation to avoid doing so.

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