Moguls: Models matter most

Tech convergence critical, say Cable Show panelists

Industry leaders discussing the implications of consumers having media everywhere all the time surprised themselves by having more on which to agree than disagree during the opening general session Wednesday at the Cable Show.

"I think you're going to find this panel in violent agreement with each other, and that is a sea change," CBS Corp. president and CEO Leslie Moonves said. "As one of our guys said, 'Wireless is useless if it is hitless.' "

"The interesting thing that has happened is the dialogue has changed," he added. "A few years ago, there was wariness between technology and content. Now we welcome all formats to get our content out there as long as the economic model fits what we do."

During the panel "Media Everywhere: Implications of the Always-On Network," moderated by former FCC chairman Michael Powell, there also was agreement that rapidly changing technology is altering every aspect of society, industry and people's lives.

Time Warner CEO Jeffrey Bewkes, one of the most vocal advocates of the "TV Everywhere" initiative, said they already are seeing that with new platforms and devices people are watching and using media more, and are excited about the content they now can access.

"The question becomes is the business model going to work," he said. "Is there a way to give this to people ... (but also make sure) it is profitable to deliver this product?"

Comcast CEO Brian Roberts said the cable industry and content providers have taken huge financial risks that the new opportunities will pay off. He said for cable operators, the "big bet has been to be the enabler," who can deliver all the new content, data and evolving platforms.

Fox's Tom Rothman had a different concern. He sees a downside to having content everywhere unless it is done in an orderly fashion.

"I actually don't believe it's ultimately good for content creators for everything to be everywhere all at once," he said. "Yes, it's a reality, a fact of life, but all of those transitions have been managed over the years by windows. I believe that windowing (releasing content in a sequence over time), which in the popular consciousness is unpopular ... is hard to do, but it is vital."

Bewkes agreed that there is a need for windowing the release of content, especially movies, but said there isn't really a choice about whether it is evolving. He said about 20 million homes now have broadband service, a number that will soar to more than 50 million in a year.

The bigger challenge to Bewkes is the entry of such other players as Apple, Google and Walmart, who skim off profit and can impact pricing. There also are the social networks including Facebook or Twitter, which are a growing force but also create new opportunities. However, he added, it is these third parties who often link back to the content creators, bringing huge and needed traffic and sales.

"If you look at the sweep of history, it is getting more efficient and profitable to deliver this product," Bewkes said.

Moonves noted that viewing is up for many major events on TV, which he attributes to viewers' ability to interact with what they are watching. He said during the Super Bowl and Grammys, for instance, many people were online or on social networking sites at the same time, making it an interactive experience.

"Every piece of technology that has come into being has been a friend of content," Moonves said. "The more places it is, the better for programmers as long as we get paid for it. For someone as old as I am, it's overwhelming, but to experience and put it out there is the best for everyone."

Technology guru Marc Andreessen of Andreessen Horowitz said an area where the changes are even more rapid is in games, where much of the action is online. He said there is a "massive seismic shift in the video game industry," as players are drawn to free sites where they are then pitched upgrades that they pay for to enhance the experience. He called that the "intersection of trends" in media.

Andreessen also said he is a major media consumer and has a commercial high-speed line in his home that costs him $4,000 a month.

That brought a laugh from Moonves, who said selling Netscape must have been profitable.

Moonves said that as they figure all this out, the challenge will be to measure usage and remain relevant.

Roberts, whose company is involved in acquiring NBC Universal, agreed but said there is another challenge: No matter how good traditional industries are at adapting to changes, that might not be enough.

"One of our problems has been it can be more fun and cooler on some of these other platforms," Roberts said. "The technology is moving faster. We have to get on that bus. We can't stay on our bus. ... (We have to ask), how do we embrace this technology but not throw away the old business models?"
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