Cable TV goes mobile
The HBO Go app from Time Warner has already produced more than 1 million downloads and it shows no signs of slowing down. The software runs on platforms such as iOS and Android and allows full access to more than 1400 shows, including full seasons of many of HBOs most popular programs. Response has been mostly positive, and Cinemax Go is currently in development.
The current trend of legacy content from a broadcaster being made available on mobile mirrors operations such as cable TV itself: It's all about the add-ons. As the first and second season of "The Sopranos" ramped up, viewership was high. But when a season ended, HBO saw a sharp drop in subscriber numbers. It was obvious that people were only subscribing to HBO primarily for that one show. Some local operators even began charging extra for shutting off and turning on of certain pay channels. Cable networks got smarter. If one show could increase subscriber rates, several could keep subs. Staggering shows — with various seasons running, ending and starting — would keep viewers locked in and paying the extra monthly fee.
Digital cable providing video on demand was a logical extension to focus on, offering many of these series via VOD. However, entire seasons were not often available and many legacy seasons were not available at all. Most of the series were also available on Blu-ray, DVD and digital download via sources such as iTunes, so providing too much could cut into profits. Developing the HBO Go app was one way to extend the brand but not cut into external profit and revenue streams. Time Warner has hinted that there are numerous ways to develop the mobile TV app, even offering content a la carte, but no plans have been announced. Offering individual seasons via an iTunes-like Season Pass, or even offering the network as an all-you-can-watch paid option if you are not a subscriber (to use the app now you must be an HBO subscriber) is certainly an intriguing concept and one worth exploring. If you just wanted to watch "True Blood" and no other HBO shows, you'd have to shell out for a satellite dish, cable TV and then the monthly premium for that specific pay show. But if HBO Go offered an in-app purchase of just the new season of "True Blood" for a few bucks, it would be worth it.
The only current hitch with HBO Go is that only certain cable operators and satellite providers work with the app. The most notable exception is Time Warner Cable, which was spun off from Time Warner in 2009. Hopefully this situation is rectified shortly, as customers of one of the largest cable operators are very vocal about wanting to join in.
As ground breaking as HBO Go may be, the concept was actually started a year earlier with the Netflix app. Whereas the HBO app focused on cable TV content, Netflix centers more on broadcast content for mobile. Its ever expanding and growing base of streaming content not only includes thousands of movies but a huge amount of full season broadcast TV shows. Cable is certainly represented as well. HBO is nowhere to be found, but some pay channel content such as Showtime ("Weeds," "Dexter," "Californication," etc.) is readily available.
When Showtime first agreed to be featured on Netflix streaming several years back, it saw a great avenue to promote its stable of series, ideally hooking people in to subscribe to the actual pay channel. Back then, Netflix was primarily just a DVD rental service, and some people did use the streaming option to watch on their laptops. These days it's a whole new ball game. Blockbuster went bust and Netflix blossomed, and now Netflix is available on many mobile devices as well as on Xbox 360, ROKU, PlayStation 3 and Apple TV. Netflix has stated on numerous occasions that streaming is the future of its service and will eclipse DVD sooner than we think. It's not just offering pay channel content, it is a pay channel — with 20 million subscribers. And Netflix is now offering original content. Check out the excellent documentary produced by Netflix, "180 South," on the streaming service and stay tuned for its initial first-run original Netflix series, "House of Cards" starring Kevin Spacey. It's exciting to anticipate a new series debuting not on TV, but on your mobile device. And it's worth noting that the steps Netflix is taking are exactly how HBO/Showtime got their starts as not just movie services but providers of original content.
The fuming you hear in the background is Showtime, which now sees Netflix as a threat. Showtime's contract with Netflix expires this summer and, yes you guessed it, it will pull its original content from the service. No "Weeds" for you. Netflix says it is still in negotiation, but Showtime has made it clear it will cherry pick a few episodes here and there to promote its pay channel via Netflix, and that's it. It's unfortunate because getting its content out to mobile TV does introduce its series to an entire new audience of millions who may never even consider subscribing to Showtime. Consumers may check out a new series they have never watched on their phone or tablet, and may get excited enough to add Showtime on their dish or box to continue with the latest season.
The obvious trend is that cable content that had always been locked into a broadcast realm can now be freed up and merged into streaming on-demand for mobile TV. While Netflix had been the obvious source, networks have figured out how to do it for themselves now, potentially bypassing third-party networks such as Netflix (yes I am calling it a network now, you heard it here first) and creating mobile TV solutions completely built around their brand. Now 500 different apps for 500 different channels may not be the best, and there is potential for services that get huge like Netflix to actually begin offering a Netflix + HBO package for a mobile device in the not too distant future. Either way it's an exciting time, and never has more cable content been available wherever we have our devices. It will be interesting to see how this all plays out. The content wave is coming and the stream is just starting to pick up steam.
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