CBS, Moonves lose nerve on tough OTT position with launch of All Access

Daniel Frankel, FierceCableIn the cable industry, they're not booing. They're chanting "Moooonves."

Speaking at the Goldman Sachs Communicopia Conference in New York on Sept. 10, CBS Corp. CEO Les Moonves made it very clear.

"We the networks should not be penalized because you the station do not negotiate retrans properly," he said.

Moonves' blunt comments come a month after CBS abruptly broke off talks regarding a new affiliate agreement in Indianapolis with LIN Media, which refused to cave in to CBS' reverse-compensation demands. CBS ended up making a deal with Tribune in that market.

Moonves' latest tough talk about retrans also came about five weeks before CBS would deliver a bombshell--it was making all of its shows available over-the-top via a $5.99 SVOD service.

You can't say Leslie Moonves is short on chutzpah.

In case you got so consumed with HBO's big OTT announcement that you missed it, CBS All Access offers current season streaming access to 15 CBS primetime shows, with new episodes showing up on the service the day after they air. You get live-streaming of 14 big-market CBS owned-and-operated stations. There's archival seasons to eight current shows, including The Good Wife, Blue Bloods and Survivor. And there's access to a library of 5,000 episodes from older shows like Star Trek, Cheers, Twin Peaks and CSI: Miami.

And it's all there for you, without a cable subscription.

Of course, the conventional wisdom is that media executives can't ignore the insurgent threat of over-the-top distribution any longer, and allegiance to the pay-TV model is no longer an excuse for not launching experimental business models of significance.

I get it. That's what Hulu was all about … when it launched back in 2007, two years before TV Everywhere was a thing, and without CBS involved.

You can say what you will about, say, Disney, for working both sides of the fence all these years in regard to Hulu. But the conglomerate has been an aggressive developer of pay-TV multiscreen platforms for channels like ESPN and ABC. And if you're a pay-TV operator, you can't necessarily condemn its participation in Hulu, which was a forward-looking response to the OTT threat. You have to consider Hulu to be grandfathered in before the emergence of TV Everywhere ... and before the steep rise in retransmission consent fees.

But by not participating in Hulu--and by suing the tiny antennas off Aereo, and making funny barbs in the process--I honestly thought Moonves was ready to man up and back his tough talk on broadcast retransmission. I thought he'd be the last guy to cave to OTT pressure and diversify out of the pay-TV model.

Several years ago, while covering a Hollywood Radio & TV Society event, I heard Moonves explain his conservative philosophy regarding digital platforms by calling CBS shows the "family jewels." And I always thought he had the family jewels to stand tall in the pocket and support his staunch retrans position as bursts of OTT hysteria went off all around him.

Will CBS cannibalize its pay-TV base with All Access? Given the median age of its core viewership, probably not a ton--the average 54-year-old Good Wife fan isn't typically an SVOD binger. And is the bundled price pay-TV subscribers pay for CBS more than competitive with the $5.99-a-month charge for All Access? Yeah, sure.

But now CBS is out there, with an OTT product that has its name on it. It's not live-streaming of Big Bang Theory, but it's next-day, Hulu close.

And as Moonves and CBS lead the charge on manifesting SNL Kagan's new prediction that retrans will more than double to $9.3 billion by 2020, All Access will certainly come up in negotiations.--Daniel

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