ESPN, Fox, ABC reluctance to pivot toward linear streaming models could doom them

Samantha Bookman, FierceOnlineVideo

Despite CBS' all-in strategy to provide linear and on-demand streaming with its All Access paid subscription service, other major broadcasters have yet to fully commit to linear OTT services -- or even just more robust TV Everywhere content offerings. What's the holdup?

Fox this week announced that it will livestream prime-time programming on its Fox NOW app and via its fox.com website. The catch? It's only available for authenticated viewers, meaning people who have a pay-TV subscription and sign in to the app or website with their operator-supplied account name and password.

In the meantime, The Information reports that ESPN is considering offering a package of live-streamed programming directly to consumers. The catch? At the moment, that package won't include live sports … which is kind of the reason most people watch ESPN, one assumes.

And ABC today said it is creating dozens of short-form, digital-only series optimized to be streamed via smartphones. According to Recode, the content will be entirely ad-supported and available to anyone who downloads the ABC app or visits its website.

Not one of these announcements is at the earth-shaking level of disruption that occurred when CBS and HBO made their respective leaps into the direct-to-consumer streaming world. Instead, Fox and ESPN are taking tentative, shaky steps into what the pay-TV industry sees as a competing distribution segment. ABC is actually taking a step backward, trying out the "webisode" idea that content providers attempted to foist on audiences just a few years ago, without much success, "generally because they really didn't want you watching their TV shows anywhere but on TV, so they were hoping some digital bits and pieces would be enough for the web," said Recode's Peter Kafka.

They're marginally expanding their audience mainly by giving viewers an additional out-of-home, multiscreen viewing option of content they already get through their cable or satellite provider, often through that provider's own authenticated multiscreen app.

Come on, guys. That's so 2010.

Seriously, Fox and ESPN have essentially reached the level of multiscreen viewing that Time Warner Cable's Jeff Bewkes and Comcast's Brian Roberts were advocating for when they first touted TV Everywhere in 2009. Seriously. The pay-TV industry was capable of offering robust content to their broadband subscribers more than six years ago. The technology has been in place all this time. They just didn't want to shift their business models.

Meantime, the audience is rapidly moving on. ESPN has been hemorrhaging subscribers for several years now, as more viewers complain loudly about having to pay for a service they don't want and don't watch, and more MVPDs oblige their customers with skinny bundles that cut out the sports network. Younger viewers no longer watch traditional cable or broadcast news; the majority get their information through social media outlets like Twitter and Facebook, with their crowd-sourced, live streaming capabilities that bring events to viewers almost the instant that they happen.

Online video works best when it directly addresses the needs and wants of the audience, and it's been established almost from the beginning that TV Everywhere does not do that. "It's such a disaster, the consumer is almost never considered," BTIG analyst Rich Greenfield told FierceCable in a 2014 story on the sad state of the TV Everywhere segment.

It's not that broadcasters and traditional distributors aren't paying attention, either. Consider the latest from Washington, D.C.:  Pay-TV operators led by the NCTA are frequenting the FCC, trying to convince the commission to give up on creating new rules that make their set-top boxes available to consumers (Tom Wheeler's "Unlock the Box" initiative) and instead consider rules to "Ditch the Box" and try "market-driven" solutions and open standards along a faster, two-year timeline.

Those solutions could include things like using already-available device alternatives, such as those nifty Roku boxes and Apple TV devices and Chromecasts. Pay-TV operators could stream their signals through these popular consumer devices using apps, which would provide an experience that one could almost call … linear.

In terms of costs -- set-top boxes are expensive to upgrade and replace -- the pay-TV industry stands to save a lot of money. Having cheaper, better-made, more energy-efficient devices on hand to deliver their content would help operators keep up with consumer demand for more robust offerings and better video experiences.

Broadcast networks aren't as hamstrung by FCC regulations. They do need to unravel a lot of legacy licensing agreements that keep much of their content off of TV Everywhere and other OTT apps they may have.

ESPN is a prime example of this -- tied up in its own content licensing agreements with pay-TV operators, reportedly charging the highest per-subscriber rates for retransmission of its signal. But it's still a wonder that the network, with all its resources, can't work its way free of most of these constraints to bring its live sports content directly to the viewers that actually want such content.

As CBS All Access has shown, all networks like ABC and Fox need to do is apply a little more thought and effort toward finding out what the consumer wants, and then delivering what they want online: a robust, quality content experience that closely mirrors what they get to see on their living-room TV screens. -- Sam

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