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ABC Expands Internet VOD

ABC's parent company Disney announced this week that it would begin offering current episodes of some of its most popular primetime broadcast shows on the Internet for free beginning in May.

During the two-month online "trial," consumers will be able to download episodes of "Lost," "Desperate Housewives," and "Commander in Chief," as well as the entire present season of "Alias." The shows will include ads that viewers will not be able to fast forward; however, as part of the experiment, ABC says it is offering 10 advertisers the opportunity to test possible in-stream broadcast ad models as well as buy sponsorships.

Viewable on Macs and PCs, the shows will be encoded and streamed in Flash 8, a Macromedia standard that emphasizes Web interactivity and will be shown in two different sizes--a standard viewing size of 500x282 pixels (streamed at 400 kbps) and a larger viewing size of 700x394 pixels (streamed at 700 kbps).

ABC already offers episodes of "Lost" and "Desperate Housewives" on iTunes for $1.99, but this is the first time a network has offered multiple primetime programs online, for free. The move is another example of the networks' mad rush to the Internet in recent months--in addition to ABC, NBC also offers selected primetime shows for downloading on iTunes and CBS recently streamed NCAA March Madness basketball games and highlights from the Masters on the Web.

"This announcement highlights the momentum we've achieved both in launching new broadband services and working with strategic partners in the digital media space, to ensure that our high-quality, informative and entertaining content is available to consumers whenever and wherever they choose," said Anne Sweeney, co-chair Disney Media Networks and president, Disney-ABC Television Group.

ABC also hopes to avoid making the same mistake it made last fall when the announcement of its iTunes deal caught many of its affiliates off-guard. The network says it is "exploring ways" to work with its local affiliates as the online experiments evolve.

"Our ultimate goal is to find an effective online model, one in which our affiliates can take part," said Alex Wallau, president, Operations and Administration, ABC Network. "To that end, we'll be sharing information from this two-month test in our discussions going forward, and working on ways for them to participate in this new method of delivering ABC programming."

ABC may want to take its cue from Fox, which this week reportedly cut a deal to share revenues from its online offerings with its affiliate stations, according to Business Week.

Technically speaking, the announcement is another sign of what media pundits see as a validation of the concept of IPTV, in which viewers of the future will get on-demand programming over IP connections. Financially speaking, it illustrates how media giants are scrambling to hold on to viewers while looking for new ways to retain their ad base.

The move is "partly desperation and partly belated recognition that [the networks] must do something to salvage their relationships with diminishing and distracted audiences," said Gary Arlen, a media analyst based in Bethesda, Md. "Moreover, and very importantly, it gives old media a chance to continue their ties to crucial advertisers."