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April 17, 2014

Warner Bros. begins the downfall of network television

by Chris Thilk, posted Sep 14th 2006 5:51PM
studio 60In separate deals hammered out with NBC and ABC, studio Warner Bros. has sliced itself off a piece of network flesh and begun what I think will lead to their eventual implosion.

The deal involves the division of income from digital distribution of the WB-produced shows Studio 60 on the Sunset Strip and The Nine. Under terms of the agreement, the networks will keep all income from the sales of ads they insert into the shows when they're streamed on the network's websites. Warner, however, will get to keep all the income from what it refers to as permanent downloads of the show such as those through iTunes or Amazon. It might look like a win-win for both parties but believe me when I say that the only winner here is Warner Bros. Keeping all the revenue from sales of their shows is going to open their eyes - and the eyes of all the other studios producing shows - that the network distribution model is unnecessary.

Right now the networks can only distribute "X" number of shows, basically whatever it can fit into their TV time-slots. But online has infinite distribution capabilities and can be very "Long Tail" friendly, meaning that audience niches can find content they enjoy and view it. When the studios realize they can produce shows, distribute them online at very little cost and then recoup that cost by finding a loyal audience willing to pay for it the networks are dead. The network model simply no longer makes sense in a digitally distributed world. What's the difference, really, between clicking on the "NBC" category in iTunes as opposed to clicking a "Warner Bros." category? All it takes is a little time to teach people where to look for it and that's it.

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Jon Lachonis

From this little piece: http://www.digg.com/television/Studio_60_s_Peet_rumored_to_be_on_the_chopping_blog

It really doesn't sound like there is much to cut. Y'know I didn't like West Wing either...

September 15 2006 at 3:57 PM Report abuse rate up rate down Reply
Grim

The big problem with your argument is that for online shows to be popular they still need to be advertised, and being on a network line up is easily the best wa to do that. Even though Nobody's Watching was in internet terms a huge hit, it wasn't even watched by half a million people for free.

It is the same with movies, DVD sales generally make studios more revenue than theatrical releases, but they won't abandon the cinema as it is a huge part of promoting the product.

The big problem is that it will make networks even more ratings hungry as they don't get the back end, so they will only stick with programming that makes them loads of ad money up front. Leading to less creativity, more derivative shows and more early-cancellations.

September 15 2006 at 1:43 PM Report abuse rate up rate down Reply
Jared Christensen

kind of an irrelevant arguement when you consider all the networks are owned by studios though....

September 14 2006 at 9:03 PM Report abuse rate up rate down Reply
joevideo

Don't forget though, that the lemmings still need someone to show them the way to the cliff. If the network model goes away, who will become responsible for determining "popular" content?

September 14 2006 at 7:42 PM Report abuse rate up rate down Reply
jeff d.

Agreed, and also, as soon as Apple rolls out its iTV product, the bridge between PC and TV appears, making your scenario all but inevitable.

September 14 2006 at 6:51 PM Report abuse rate up rate down Reply

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