TV Everywhere may finally be starting to get somewhere. The pay-TV industry has tried for years to get its streaming video act together. The goal, expressed by executives from Time Warner (NYSE: TWX) and Comcast (Nasdaq: CMCSA) in 2009, is to let paying subscribers access the shows they get through their cable, satellite or telco TV subscription on Web-connected devices like iPads and smartphones.
Execution on this vision has been uneven, which is understandable. Networks and distributors have had to acquire an entirely new set of skills to develop software for these new devices and keep their apps up to date. Furthermore, while programmers and distributors seem to agree that giving subscribers access to these services is a good idea, there has been much less agreement on how to value these new services when traditional carriage deals are negotiated or who will ultimately be responsible for the consumer-facing apps that deliver the programming.
The past week brought a handful of new developments and evidence that the industry has not given up. Discovery (Nasdaq: DISCA), a long-time TV Everywhere hold-out, has finally agreed to a deal with Time Warner Cable (NYSE: TWC) that includes some authenticated online video. The details are still sparse, but it sounds as if Discovery will have its own apps that will be accessible to authenticated TWC subscribers. Surely, deals with other distributors will be next.
That's a model that has worked well for the pay-TV networks with the strongest brands such as HBO and ESPN. And it represents one way--call it the networks' preferred way--of delivering on the promise of TV Everywhere. It's also one being taken up by Fox's new FXX network, which will introduce FXNow later this year. The authenticated app will offer on-demand viewing of shows, movies and now the entire catalog of reruns of "The Simpsons." And the network represents one of the first high-profile programming services to launch into the TV Everywhere world with a thoughtful app strategy as part of its business plan.
Meanwhile, DirecTV (Nasdaq: DTV) said it will begin offering live streams of 30 networks, including premium networks such as HBO, Starz and Showtime, outside the home through its TV Everywhere portal. Another 100 or so networks will be available to stream to subscribers using the app within their homes. This represents the distributor-centric model pursued by the country's largest pay-TV providers.
Following these trends to their logical conclusion leads to a confusing world for consumers, however. If distributors are successful in negotiating the rights for more out-of-home streaming, they'll eventually be able to offer what amounts to their full pay-TV lineup on any device, anywhere. Meanwhile, networks are pushing their own branded apps so that when viewers power up their iPad or Roku, they interact only with the network's own app and content.
If a consumer wants to watch HBO, will she do it through HBO Go or a distributor app like Xfinity? For now, the choice seems clear in HBO Go. But smaller networks without the resources or the depth of programming offered by HBO may find it harder to attract viewers to their apps.
These are concerns online-only distributors such as Netflix (Nasdaq: NFLX) and Amazon (Nasdaq: AMZN) aren't encumbered by. That could give them a leg up over traditional pay-TV networks when it comes to developing new products for Web-connected platforms.
Indeed, it feels as if some of the cable networks are playing catch-up to features already offered by their online video rivals. But they are catching up. -- Josh