Warner Bros. begins the downfall of network television
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.