Are we about to see the end of free TV?
That's the question now coming up with cable television giant Comcast's $6.5 billion deal that will give it 51% of a new joint venture that includes NBC Universal, valued at $30 billion. Comcast chief executive officer Brian Roberts is already gushing about the deal delivering Internet TV to every home. With a TV in just about every home, it might deliver consumers multi media options from their TV, not their computer.. "Let's say you're in the mood to watch 'Sleepless in Seattle,' " Colin Crowell, senior counselor to FCC Chairman Julius Genachowski told the newspaper. "You could either get it as a movie on demand from your cable provider, or go online and see when it's going to be on Bravo and set your DVR to record it, or go to Netflix and download it."
And that puts the future of free TV in doubt. According to Benzinga.com, free TV could soon go the way of the horse and buggy. It says: "Since the 1940s broadcasting stations have been able to show local channels and programming for free, relying completely on advertisements. However, times are changing. Many viewers have changed to cable or rely on the internet to obtain news and watch favorite shows. As a result, advertisers have opted for these advertising opportunities. The economic situation throughout the country also plays a role in the future of free TV. If these networks decide to move primarily to cable companies, this could be the end of the free services."
The problem for free TV is that it's been bleeding money. It needs to find a new business model and it needs to do it quickly.
Fitch Ratings analyst Jamie Rizzo has told The Canadian Press that one of the broadcast networks could explore becoming a cable channel by 2011 which is really not that far away. Cable TV and the Internet, combined with the recession, have drained free TV's advertising dollars. At the same, cable TV has been insulated from the effects of the recession.
An even more interesting question is whether we are about to see a similar trend in other countries. Let's keep in mind that television channels are struggling right around the world and they might look to the US for a new business model. If that happens, free TV will be well and truly dead.
That’s something we should all pay attention to. It may be the end of free TV but it may also be the beginning of a new TV era, an era of innovation that puts may fit our favorite TV shows in our schedule. That would be something people would be willing to pay for.