Emmy Awards 2013 Highlight Brand New Business Models
Senator John McCain introduced the Television Consumer Freedom Act of 2013 to combat what he called an, "injustice being inflicted on the American people". The 14 Emmy nominations that Netflix Productions recently garnered indicate that McCain may not be the only person frustrated with the tradition television business model.
David Fincher made history Sunday night for best director being the first major category win for an online distributor. The evolution from network domination of the airwaves to cable and now increasingly to the internet is changing the face of home entertainment. As millions of viewers are growing accustomed to being able to watch their favorite shows whenever and wherever they want, a showdown with cable providers appears imminent. Technological innovation may be progressing faster than economic and political action. However, this year's Emmy awards may have documented the beginning of the end for traditional broadcast television.
The average cable viewer probably doesn't know how much they pay for each channel offered in their subscription package. Last year, Dustin Rowles from UpRoxx.com came across 2009 data showing how much we actually pay for each cable channel. The average channel cost $.20, and channels like ESPN and HBO cost many times more. CBS' recent victory over Time Warner shows the leverage content providers of popular programs have over cable providers. The ability of popular channels such as CBS to pressure distributors is enhanced by the increasing popularity of internet options such as Netflix and Hulu. However, this increasing competition could lead to cable providers seeking longer agreements and forcing many consumers to continue to pay for channels they don't want.
Consumers aren't the only ones who stand to benefit from a new television model. Content creators are already benefiting from technological innovations, which allow them to create and distribute original material to the increasing number of individuals around the world with internet access. This in combination with loosened communications related restrictions has the potential to revolutionize the way people make and view televised entertainment. It comes as no surprise that major networks and cable providers feel threatened by the internet. The increasing number of people choosing non-traditional means of entertainment means that advertisers will have to change the way they operate as well. There is already evidence of this trend, and without action taken to limit it, there is little reason to think it won't become more prevalent.
No matter how hard they try, the days of content distributor determined baskets of programming may be coming to an end. Like in the music industry, the internet has drastically changed the old television economic model. Consumers have more options for what to watch and how and when they want to do it. This is not the first and surely won't be the last time industries and companies affected by technological progress try to prevent the inevitable. Hopefully this time, instead of fighting change, those affected embrace it and look for ways to benefit through innovation and creativity.