A brilliant move by Disney! Kudos…

Posted by Jim Stroud

April 10, 2006

I do not blog on the biz world as much as I would like to, but maybe that will change? When I read this story in the WSJ, I thought BRILLIANT!!! I also predict that Disney is leading the charge on what will become a standard in the very near future. Kudos to Anne Sweeney!!!

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Walt Disney Co. plans to make much of its newest and most popular programming on ABC and other channels available free anytime on the Web, in a move that could speed the transformation of television viewing habits and help revive the struggling TV advertising business.

On April 30, ABC will unveil a revamped Web site that will include a “theater” where people with broadband connections can watch free episodes of “Desperate Housewives,” “Lost” and other hit shows on their computers. Episodes will be available the morning after they air and will be archived so people can eventually view a whole season. A Disney Channel version with five shows will start in June, and an ABC Family version is also planned. Disney’s Soapnet cable channel will start offering programs free on its Web site, Soapnetic, on April 17.

[Anne Sweeney]

Episodes of the ABC shows — which can be paused, rewound and fast-forwarded — will contain commercial breaks that viewers can’t skip, making Disney hopeful it has figured out a way to turn the delivery of programs over the Web into a profit-generating business. Ten advertisers, including Ford Motor Co., Procter & Gamble, Universal Pictures and Unilever, already have signed up.

The initiative, to be announced today by Anne Sweeney, president of the Disney-ABC Television Group, marks a watershed: the first time a TV company is offering major prime-time shows free online without restriction. Until now, networks have brokered limited piecemeal deals in a bid to keep business partners happy and their traditional business models intact. CBS Corp. has come the closest to what Disney is planning, offering rentals of “Survivor” episodes on CBS.com for 99 cents.

But so far, none of the other big TV networks have hinted at plans comparable to ABC’s. The strategy at CBS is to make its TV shows available on as many platforms as possible — including cellphones — while General Electric Co.’s NBC Universal is developing unique programming for the Internet. News Corp.’s Fox is seeking to move shows online in a way that shares revenue with affiliates.

Nearly anyone with a computer and a broadband connection will be able to watch Disney’s TV offerings online. Still, Disney is putting such a huge volume of programming online that some analysts say it could spur sales of media-rich computers, as well as devices that transmit Internet content to be watched on most types of TV sets. “All this area needs to explode is enough top-notch content,” says Brad Adgate, senior vice president at Horizon Media, a New York consulting firm.

Online streaming — the technology of broadcasting video programming over the Web — has been an area of great untapped potential for the TV industry. The possibilities were underscored by the success of CBS’s online streaming of the NCAA basketball tournament in recent weeks. The “cable bypass,” as CBS Chief Executive Leslie Moonves calls it, could have dire implications for cable and satellite purveyors because it has the potential to cut off the revenue they receive for delivering programming. Making shows available online also could undercut the on-demand services cable operators are rolling out.

The ABC initiative reflects a sharp turnaround at Disney’s television unit. Two years ago, ABC was the last-place network, and cable properties such as ABC Family were in a slump. Then Chief Executive Robert Iger, who has become unexpectedly aggressive in digital media, grouped all of the company’s TV units under one umbrella.

SOURCE: Disney Will Offer Many TV Shows Free on the Web

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