If You Can’t Beat ’em, Join ’em. Time Warner Decides To Join Forces With Google

A staggering stat (from Google) indicated that YouTube (owned by Google) has more content uploaded in 60 days then the three major TV networks broadcast in 60 years. It would stand to reason then that the networks would want to become play ball with Google. This is exactly what Time Warner Inc. is doing by playing ball with Google Inc. Not to be outdone, NBC Universal’s CNBC network and the NBA also announced they would build Google TV software applications. The plan for Google world domination continues.

Amplify’d from www.wallstreetjournal.com
The chief executive of Time Warner Inc. said he is turning to Google Inc. as an ally in his push to bring cable shows to users across various devices and that the Web giant’s new service for accessing and searching Internet programming on TVs isn’t the threat many television distributors fear.

Jeffrey Bewkes, who oversees a company that includes the TNT, TBS and HBO cable networks, also predicted a “massive amount of competition” for Netflix Inc. and Hulu LLC as more content owners make their TV shows available through operators on demand and online and as cable and satellite companies improve their experiences.

“When all of the content on the big screen works like the content on the little screen what will happen? The programming will trump the interface,” he said.

[BEWKES] Bloomberg NewsTime Warner CEO Jeff Bewkes, shown in May, says content is still key.

Mr. Bewkes’s comments come as media executives are agonizing over which new Internet distributors to supply shows to and whether to pursue new digital distribution methods on their own. Hulu and Netflix had no comment.

Time Warner has been championing a model it calls “TV Everywhere,” allowing cable and satellite subscribers to watch the TV shows they pay for in their traditional TV bundles online, free.

Tuesday Mr. Bewkes said that Time Warner, which already has deals to enable Comcast Corp. and Verizon Communications Inc. subscribers to watch shows from its cable networks online, has or is close to finalizing similar deals with Dish Network Corp., DirecTV Group Inc., AT&T Inc. and other cable operators as well.

Monday, the company also endorsed the Google TV technology, saying it would optimize some of its television websites, including those of TNT, TBS and CNN, for viewing on TVs carrying Google TV. It said it would do the same with its HBO GO website, through which some viewers who subscribe to the premium cable channel can watch its shows online. The arrangement isn’t a business deal.

Google is working with several partners to build televisions and boxes carrying its software. Logitech International SA plans to discuss its set-top box running Google’s new software Wednesday.

NBC Universal’s CNBC network and the NBA also announced they would build Google TV software applications that provide access to content like financial news and sports scores. Other television networks—including the major broadcast networks—have largely been mum about whether they plan to work with Google’s service.

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How an App Store Could Revolutionize the TV Industry

Did I get out of the television industry just in time or could my two worlds… that of new media and traditional media… be coming together in an Apple App Store? I’ll be watching the development of Apple TV very closely but in the meantime, I’ll stand by one of the very first blog posts I ever wrote “content is King” (or as someone pointed out… Queen… or Emperor… or whatever dictator name you feel appropriate to insert)

Amplify’d from theappleblog.com

This week’s media event could finally confirm (or scuttle) rumors of a new Apple TV device. If it’s based on iOS 4, like many pundits believe, there’s strong potential for this device to feature its own App Store. If such a future came to fruition, Apple could be facing another round of tough negotiations with content producers like it faced when it introduced the world to digital music and movie downloads. If it’s successful though, Apple could revolutionize the television content marketplace.

The Current Marketplace

Consider how you currently watch TV, which could be through broadcast or cable television. If you watch cable, you pay a fee to a provider (like AT&T), which allows you to see certain channels based on your subscription (though that model doesn’t seem to be panning out so well anymore). The providers pay a portion of your subscription fees directly to the networks (an average of about 26 cents per channel). Networks make additional money with the ads they run on their channels as well. If a network doesn’t show ads, you can expect they charge the cable provider substantially more than 26 cents per channel, and the opposite is true if they show an average amount of ads. This is all relative and pretty much a standard business model.

How Apple Could Shake Things Up

With the introduction of the App Store, we’re starting to see how some industries are shaking up the status quo. For instance, consider the magazine industry. Wired now provides its app directly to consumers, and can sell a digital version of its magazine at a comparable price (per issue) to the newsstand price. Yet, without having to incur the printing costs behind it, and even while giving Apple 30 percent of the revenue, Wired pockets a lucrative profit.

Can the same model work for the television industry? Network providers already provide their content through iTunes, and, through negotiation, have arranged to sell content at $2-$3 per episode. Rumors of 99-cent TV shows have been rampant but unfulfilled, simply because of the tough negotiations required to make it happen. Could the solution be to simply bring an App Store directly to the TV? If so, similar to the Hulu or Netflix app, a network provider like HGTV (s sni) could provide its own app for free and charge within for in-app content, like episodes of a show. If it wanted to provide streaming content of the past few episodes for free, it could do so. As long as it approves of the 70/30 profit split with Apple, it would maintain a lot more control over its content and pricing. The networks would be happy, and Apple would be happy. Networks could still run ads as they wished and earn even more profit.

Who would stand to lose from this? At the outset, nobody, but if such a solution were to become mainstream, then cable providers could begin to see a dip in subscriptions. Why would most consumers pay a monthly fee of $30 to over $100 if they only want to watch a certain show or a certain network? Instead of paying for needless extra content that consumers never watch (based on their own viewing habits), they can pay for content that matters to them. The providers are aware of this, which is why many of them also provide internet service (think about Verizon, Comcast (c cmcsa) and AT&T).

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