TV Online: A Glimpse of the Future at the 'Upfronts'

May 17, 2007 — -- It is the biggest week in network television, yet television must share the spotlight.

It is "upfront" week, the time each year when ABC, CBS, NBC, Fox and others preview their shows for the new fall season. The name comes from the goal: to dazzle advertisers and secure "upfront" as big a chunk as possible of the $9 billion they will commit to ads for the fall lineups.

While the upfronts always answer what the networks plan to put on television, the question that got more attention than ever at this year's previews was where else the programs would show up.

The growing popularity of video on venues other than television has the networks rolling out major initiatives this week involving programming on the Internet, cell phones and hand-held video devices.

CBS has launched its Interactive Audience Network, which will make its shows available for free on 10 Web sites including AOL, Microsoft Networks and Joost, a new video site started by the people behind Kazaa and Skype. When he revealed this plan last month, CBS President Leslie Moonves boasted that CBS product would be "the most widely distributed professional content online."

NBC Universal makes a similar claim for its new joint venture with News Corp., the parent company of the Fox network: an Internet video site temporarily dubbed NewSite. The two broadcasters signed up six big Web distribution partners including Comcast, Yahoo and CNET for NewSite. They will also provide content. NBC Universal chief digital officer George Kliavkoff says this video portal will "reach in excess of 98 percent of the unique users on the Internet every month." This week, NBC confirmed the site would launch in the summer. It also announced that a "fully immersive" digital version of its hit "The Office" would debut in the fall alongside a Web exclusive series called "Coastal Dreams."

ABC unveiled "ABC Start Here" this week — a big marketing campaign aimed at guiding consumers to ABC programming on a variety of platforms, such as on-air, online or via mobile connection. "It's really a messaging and navigation system" said Michael Benson, executive vice president for marketing at ABC Entertainment, designed to "help manage all the [ABC] content so consumers can find things more easily," whatever video venue they are using. The network also announced a deal with Sprint that would allow subscribers to watch ABC shows on their cell phones. Popular episodes will be available on demand the day after they air or users will be able to access continuous scheduled programming on special mobile channels.

Why this big push to reach Web video viewers? The answer is big numbers. In January alone, 123 million people downloaded or streamed video, says Internet research firm comScore, Inc. And in 2006, advertisers spent nearly $17 billion on the Internet, the Interactive Advertising Bureau estimated, a 34 percent increase over 2005.

"More and more people have high speed Internet access and as that happens, they get more comfortable watching online video," said Michael Burgi, editor of MediaWeek. "People are going to the Internet to be entertained and you generally see an erosion of TV viewership. The networks are waking up to the reality that they need to have their programs in the places where people are showing up."

ABC surveyed the landscape of video sources before launching its "Start Here" promotion and found that "some people have only watched episodes of shows using iTunes or just online," according to Benson.

Yet harvesting all those Internet eyeballs is a challenge, as evidenced by the fact that the networks' approaches to doing so are all different. The reason is that the expanding universe of online video has been a messy media revolution.

A little history helps make the point.

CBS, ABC and NBC transitioned from control of radio to control of television in the 1940s "without missing a beat," said professor Robert Thompson of Syracuse University's Bleier Center for Television and Popular Culture. "They used some of the same programs and they used some of the same stars" and no one challenged the big broadcasters for dominance in the new medium.

But that is not the case with the television part of the Internet. Entities like Google video, Jumpcut, YouTube and other video portals moved in.

"The networks came relatively late to this party," Thompson said. "Now the idea is for them to acquire business models that had already been established by the time they got into it. What we're seeing in this whole upfront season is [the networks] feeling out the territory and the landscape."

The advertising dollars available on that landscape are a big part of what makes it alluring yet tricky terrain for the networks. But getting advertisers to direct some of that swelling revenue stream into online video is difficult. Advertisers like to know who and how many people will see their ads and that information about online video viewers is hard to come by.

MediaWeek's Burgi explains that "the metrics or measurements are not as sophisticated as they need to be for advertisers to comfortably move their advertising dollars off of television and into online platforms."

Still another problem for advertisers (and therefore, for the networks) is what works?

"They haven't figured out how to incorporate the advertising into online video," Burgi said. The TV model of an ad inserted every few minutes into a program may not work in a world consumer's control. "A lot of people just tune out because they don't want to sit through an ad when they are online. When they are online, they are used to being able to do what they want to do and have more control over it, unlike television."

But if securing advertising is currently a top priority for the networks as they move content online, a more fundamental issue will have to work itself out over time: What will their Web or mobile content look like?

Currently, broadcasters mainly feature repackaged or interactive versions of their television shows on the Web. Their new ventures promise a huge array of viewing options and original shows produced for the digital world. NewSite, the NBC/Fox joint portal, for example, will make available films from their respective studios, Universal and Fox. And the site "creates the financial incentives for all of our content partners to invest more in creating more original digital programming," said NBC's Kliavkoff who is also the Interim CEO of NewSite.

Look for that new content to be short. "The medium of Internet and cell phone-consumed television is going to be much more modular," Thompson said.

He envisions two- to three-minute episodes that consumers can view "at work or while you're waiting for your car to get fixed, at the dentist. Primetime for Internet video is going to be the working hours."

The rationale is that few viewers would watch their favorite TV shows on a small screen when they can store them on DVRs and watch them at home in wide-screen, high definition splendor.

"Watching 'Lost' on YouTube," Thompson said, "would be like listening to a symphony on a conch shell."

So while the upfronts provide a crystal-ball glimpse into the future of online video, that future is not crystal clear for anyone, the networks, their viewers or advertisers.

Thompson cites the past as a guide: "We are at the stage now of Internet programming where we were in about 1946 with television." Broadcasters may not all catch up with the new medium in the same way, but they are all poised to do so quickly.