It’s time to rethink the broadcast business model, says ABC’s Sweeney

The broadcast business model must evolve to satisfy a new generation of viewers and prevent piracy from devastating the television industry as it has the music business, Anne Sweeney, co-chairman of Media Networks for The Walt Disney Company and president of the Disney-ABC Television Group, told an audience on April 25 at NAB2006.

During her address, “Turning Content Into Revenue,” Sweeney told her audience that about 25,000 people are illegally downloading episodes of “Lost” within the first 10 hours after they air on the east coast, and that number is growing. “It is already too large to be easily dismissed as noise,” she said.

Clinging to old ways of thinking about how content reaches viewers is not an option. “We have to actively look for opportunities to make out content available in convenient ways at reasonable prices,” she said.

To that end, ABC began offering programming via iTunes to Video iPod owners last fall. Sweeney explained that the next step is a two-month test beginning in May of Internet distribution of selected shows. Free to the public episodes of “Desperate Housewives,” “Lost,” “Commander in Chief” and “Alias” will be streamed from and supported by an individual sponsor.

Viewers may watch the shows, pause them and resume playing them from where they left off, but they will not be allowed to record the shows or skip past the commercials, she said. With the data collected from the trial, the streaming feature is expected to become a permanent fixture on the network’s Web site later in the year.

“We expect to learn a lot from this effort about the technology, as well as the consumers who use it,” she said. “We’ll share that information with out affiliates, so we can work together to build the right online model — one that delivers the best experience for our viewers and the best opportunity for our affiliates and advertisers,” she said.

Sweeney called for a change in way broadcasters think about their business. “We need to stop saying, ‘This is how we’ve always done it,’ and start asking, ‘How would we do things if we were starting right now?’” she said. “And then we have to work together to build an industry that adapts to this new reality and creates the foundation for our next generation of success.”

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