While all the broadcast networks are working on some form of streaming service, CBS’s version unveiled yesterday is different. It combines its on-demand offerings and station streaming into one service marketed directly to consumers. CBS is creating a whole new revenue stream for itself as well as its affiliates who choose to stream their signals locally on the platform.
With little trouble, I managed to sign up for CBS All Access (one week free!) last night, but so far I can only get it on my desktop. All efforts to get the app to function on my Samsung smartphone have been for naught. But I’m hopeful. I’ve learned that if you keep poking at a recalcitrant app it will sometimes kick into gear.
Of course, because it was Thursday night, my first experience with “Live TV” on CBS all Access — the real-time feed of WCBS — was disappointing.
The flagship and the rest of the network were broadcasting NFL football and CBS has yet to clear the online rights for the games. So instead of the Jets and Patriots, I got a slide: “The program currently on-air is not yet available for live stream. Please check back soon.”
I will. CBS CEO Les Moonves says that he is working on getting the necessary rights and I believe him to the tune of $5.99 a month.
This morning I came back to the site and clicked into CBS This Morning just in time for a discussion of the service with media editor Peter Lattman of the New York Times. The service worked smoothly. I will be curious to see how often I use it.
Reaction from the affiliates to All Access has been positive and it’s easy to understand why. They just might make a buck or two on the deal.
All the broadcast networks have recognized the importance of getting their programming onto the Internet and the wireless networks to keep up with younger viewers wherever they happen to be.
To get to the second and third screens, three of the Big Four — ABC, NBC and Fox — have moved in lock step. They took stakes in Hulu, a two-tiered, on-demand service that offers old programming on an ad-supported basis and current network programming (one day after its broadcast airing) for $7.95 a month.
Then, the three adopted the TV Everywhere approach for the streaming of their stations. The approach involves what amounts to a partnership with cable and satellite operators. Broadcasters make their signals available for free, but only to “authenticated” local pay TV subscribers in good standing. Cord cutters and cord nevers are out of luck.
ABC has launched its TVE service bundled with some on-demand offerings as ABC Watch. I have downloaded that apt and, when my Samsung is not balking, I can get WABC New York on it. Several Fox O&Os and many Fox affiliates have TVE services up and running, but neither Fox nor the affiliates do much to publicized the fact. After a few delays, NBC is now promising to unveil its TVE service by the end of the year.
CBS All Access springs from a significantly different strategy, one independent of the other networks and the pay TV operators. CBS is combining the on-demand offerings and station streaming into one omnibus service and selling directly to consumers.
By cutting out the cable and satellite middlemen, CBS is creating a whole new revenue stream for itself as well as its affiliates who choose to stream their signals locally on the platform.
“CBS will handle all the billing and affiliates will get a piece of the revenue this generates in market,” Nexstar CEO Perry Sook told us after the news broke yesterday. “It demonstrates the power of the network-affiliate model.”
Sook and others with whom we spoke said they don’t yet know what their cut of the $5.99 might be, but any money flowing from network to affiliate is a remarkable and welcome change after years of the networks pressing affiliates for more and more in football subsidies and reverse comp.
Affiliates of the other Big Four networks can theoretically make money by charging cable and satellite operators extra for TVE rights in retransmission consent negotiations. But many affiliates may not be able to get it. And I’m told that ABC and NBC expect its affiliates to pay them a fee for participating. That sounds like a wash at best.
It is important for TV stations to be available online so that they can continue to claim they are the only TV medium that reaches every American, including those who eschew pay TV because of the cost and are so enthralled by their iPhone 6 they can’t figure out how to use an antenna.
Viewership of broadcast signals via TVE or All Access may be slow to grow, but it will grow as more people get comfortable with watching TV on their tablets and smartphones and someone figures out how to make a frictionless interface between the Internet and the big TV in the living room.
CBS wasn’t the only old-line media company to make a bet on Internet distribution this week. A day before CBS, HBO announced plans for an OTT service unencumbered by old pay TV allegiances. That was a perfect pre-endorsement of the CBS initiative.
And here’s a bonus for CBS broadcasters on the All Access platform. If retrans negotiations break down and they have no choice but to yank their signals off of cable systems, they can point affected viewers to All Access and tell them to sign on so they don’t miss their favorite shows or the big game. They might even offer the service for free for the duration of the blackout.
We posted a story in February 2013 discussing CBS’s streaming experiments with Syncbak. Since then, the network has been extremely guarded in talking about the service. I was beginning to think it had given up on the project.
So it was good to see the announcement of CBS All Access on Thursday — good for the network and good for the beleaguered affiliates.