How $2 downloads can revive network television.

Inside the Internet.
Nov. 1 2005 5:02 PM

TV You'll Want To Pay For

How $2 downloads can revive network television.

Firefly: Could it have been saved by on-demand TV?
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Firefly: Could it have been saved by on-demand TV?

It has now been 20 days since Apple announced it would sell selected ABC-Disney television programs via iTunes. As of Monday, iTunes customers had bought more than than 1 million videos. At first glance, these sales figures seem like another nail in the coffin of broadcast television. If we can get television content online, on demand, whenever we want it, how will networks convince us to tune in on their schedules? For that matter, how can they be certain we'll tune in at all?

The iTunes distribution model does give the networks a huge opportunity to reinvent themselves, though. By allowing viewers to purchase individual episodes, broadcast-television executives could free themselves from the yoke of advertising revenue. That could potentially usher in a new age of television, one where fans have the power to keep their favorite series in production and producers have the opportunity to create more elaborate, controversial, and innovative programs.

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Until now, broadcast television has followed a predictable pattern. If a show does not attract enough viewers, it goes off the air. Sometimes this system functions perfectly (e.g., Who Wants To Marry My Dad?), but it often fails in spectacular fashion. Many of the most innovative shows of the last two decades—shows that generated critical acclaim and cult followings—have been early casualties of the ratings wars.

When such shows get canceled, there are generally two explanations: Either the network didn't know how to market or schedule the show, or the series grew too complex and unwelcoming for casual viewers and latecomers. (Joss Whedon's Firefly is an example of the former, while David Lynch's Twin Peaks exemplifies the latter.) Both scenarios are symptoms of the same problem. There's still an assumption that if a show is good enough, a sizable audience will be sitting in front of the television when it airs. In an age of DVD boxed sets and TiVo, such a belief is fatally flawed.

As iTunes and its inevitable competitors offer more broadcast-television content, producers won't have to depend on couch potatoes as their only audience. They also won't have to compromise their programs to meet broadcast requirements. Episode lengths can vary as needed, content can be darker, more topical, and more explicit. If the networks are clever, these changes can supplement broadcast programming rather than replace it. Audiences already expect director's cuts and deleted scenes on DVDs. It's not hard to imagine that the networks might one day air a "broadcast cut" of an episode, then encourage viewers to download the longer, racier director's cut the next afternoon.

Nor will episodic programs have to be self-contained to remain accessible to new viewers. While DVDs now give viewers the chance to catch up between seasons, on-demand television will allow anyone to catch up at any time, quickly and legally. Producers will no longer have to choose between alienating new viewers with a complex storyline or alienating the established audience by rehashing details from previous episodes. (This would be especially critical for plot-intensive shows like Alias, which has been forced to "reboot" its plot several times to make it accessible to new viewers.) If they're smart, the networks will realize this is not only feasible but extremely profitable. Rather than recapping relevant details from previous episodes ("Previously on Alias ..."), we may soon be encouraged to buy our way up to speed ("Before watching tonight's Alias, download Episodes 4, 5, and 6.")

The most enticing possibility, though, is that on-demand television will allow audiences to take an active role in programming the networks. We've seen several examples of fans banding together to save their favorite programs in the past few years. Fox put Family Guy back into production on the strength of high DVD sales, NBC released Freaks and Geeks on DVD after getting bombarded with petitions, and a fan-organized campaign to resurrect Firefly resulted in last month's big-screen release of Serenity.

Direct downloads will give fans of endangered shows the chance to vote with their wallets while a show is still on the air. And when a program does go off the air, direct payments from fans might provide enough revenue to keep it in production as an online-only venture. If we assume that the average hour-long drama costs $1.5 million per episode and downloads will cost around $2 per viewer, shows would only need a few million viewers to turn a small profit. Would a few million viewers pay $2 a week to download an hour of television? It's certainly not impossible. In the past month, viewers have shelled out more than $30 million for two hours of Serenity. And even if viewers aren't prepared to pay $2 per show, there's nothing to stop the networks from offering free downloads with embedded advertising (which could be far better targeted than the ads networks currently show).

MIT's Henry Jenkins, for one, has already written extensively on potential business models for online, on-demand television. Jenkins outlines a subscription model where viewers pay in advance for an entire season of downloadable episodes, providing the startup capital needed to fund production. Episodes would also be available at a higher cost on a per-episode basis, providing a steady stream of additional funds. Downloadable television also would provide access to a global audience, which would presumably include many viewers who would be thrilled to buy episodes rather than wait for shows to arrive in their country. (The BBC is already well ahead of us on this.)

If iTunes shows us anything, it's that audiences are willing to purchase their media when it is simple, affordable, and convenient. With Google, Yahoo!, and Microsoft set to join Apple in the television wars, it's a safe bet that we'll see more major-network content for sale in the near future. For those of us who use peer-to-peer software like BitTorrent to download the shows we miss, there's no rush. For everyone else, I just hope Veronica Mars and Arrested Development will be available for download before the networks give up on them.

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