Disney Boss Has Tough Time Navigating VOD Content

“If I have to find something VOD-related, oh my God,” he said. “They’ve got to find a way to find a convenient search.”
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The executive behind Disney’s push onto the Internet and video-on-demand has a tough time navigating channels and VOD on cable in his New York apartment.

Disney CEO Robert Iger said Thursday that when he stays in New York, he goes to the computer to find channels playing on Time Warner Cable, especially elusive channels like Disney’s ESPN2

“If I have to find something VOD-related, oh my God,” he said. “They’ve got to find a way to find a convenient search.”

Iger’s comments came at the Sanford C. Bernstein Media Symposium Thursday as he discussed Disney’s aggressive strategy to make its content available in nontraditional formats like VOD and online at ABC.com

Sanford C. Bernstein is an investment research house based in New York.

ABC.com, Iger said, is providing a more engaged audience, as opposed to simply shifting viewers away from TV and onto the computer.

“In the past, if you missed an episode or two or three, you became disengaged,” he said. “Now, we’re providing people with the ability to stay engaged.”

Streaming video viewers are also significantly younger—30 on average—than the general TV audience, he said.

He compared the offerings of ESPN.com to graphics improvements at ABC Sports years ago and the enthusiastic response then of viewers. “This is that on steroids,” he said.

But plenty of work needs to be done in the formats of the future, he said. VOD navigation problems aside, Iger said connecting the computer to the TV will be vital to grow business models like Disney’s fledgling arrangement to sell movies for download though Apple. Iger said it’s too early to tell if that system is recruiting new customers who would not otherwise have bought the DVDs, or if the arrangement simply moves viewers from one format to another.

Hard drive storage space is another bottleneck in the shift from DVDs to online distribution, he said.

Until storage and computer-TV interfaces improve, “I don’t think you’re going to see mass consumption,” he said. “It will happen. I don’t know how fast.”

Iger also said affiliates were initially horrified by the thought of ABC.com eating into their audiences.

“But that was then, this is now, and it’s changed a lot,” he said. For example, Disney has developed technology so viewers can access ABC shows on affiliates’ Web sites, and even insert local ads. “That’s a big step,” Iger said.

The ABC player is also available now on AOL, a move Iger said would expand the reach of ABC.com. The company is moving carefully in finding new Internet partners, he said.

“They don’t want their high-quality content thrown in with a mess of other content,” he said. “Nor do we want viewers coming away feeling the experience was clunky or not optimal.”

On the trend toward user-generated content, Iger jokingly claimed credit for changing American culture with his creation of “America’s Funniest Home Videos.”

“I was stupid, though,” he said. “I should have thought about creating YouTube.”

Folks are fascinated with user-generated content and nowadays there’s the digital shelf space for it, so interest will remain, he said.

VOD will become ever more compelling in the future, but people are spoiled by the instantaneous search results they find on the Web and expect the same from cable, he said.

Iger said he’s shared his concerns with Comcast boss Brian Roberts and Time Warner Cable CEO Glenn Britt.

“They have to understand that the consumer today is not going to tolerate a poor user interface,” he said.