04.17.2006 12:36 PM
Disney moves primetime shows to Web; considers revenue sharing

ABC Television, the Walt Disney-owned network, took another aggressive move toward alternative television distribution last week by offering its top shows free on the Internet. However, unlike FOX, Disney took the action with no affiliate revenue-sharing arrangement.

ABC will offer several of its most popular programs, including “Desperate Housewives” and “Lost,” for free on the Internet in a two-month trial.

The move will allow ABC to double dip in advertising-offering both TV commercials and online ads-for a single show. Revenue from spots will support the trial run on ABC.com, with advertisers AT&T, Ford, Procter & Gamble and Universal Pictures already signed up.

Viewers will be able to pause and move between chapters in an episode but will not be able to skip ads that are technically embedded, Reuters reported.

ABC, as with its competitors NBC and CBS, have done new media deals without long-term deals with affiliates. ABC said it is in discussions with local affiliate stations on ways to share revenue from online ad sales. Affiliates, as well as unions representing actors and writers, have sought a bigger cut of online revenue.

Analysts said the FOX deal could serve as a model for other television networks, such as ABC. Josh Bernoff, an analyst with Forrester Research, told Businessweek that this is a way to get the affiliates to “stop whining. It's a negotiating chip.” He said that any network that doesn't do this would just have to deal with it sooner or later in negotiating renewals of affiliate agreements.

ABC confirmed that it wants to make a deal with its stations. Alex Wallau, president, operations and administration, ABC Television Network, said in a statement that the ultimate goal is to find an effective online model, one in which affiliates can take part.

Disney is also launching a high-speed Internet channel for soap opera fans, called Soapnetic, on April 17 for subscribers to Verizon Communications' Internet services.

ABC's plan is the first time a broadcast network will give away full-length hit primetime TV shows on the Internet, the New York Times reported.

It is also an indication, the Times said, of the pressure networks are feeling from popular video-on-demand services that allow viewers to see TV shows and movies when they want.

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