Jurassic broadcasters evolve with Net, digital


CANNES -- Another MIPCOM, and more yadda yadda on the conference stage about the end of broadcasting as we know it. And guess what? CBS, ABC, the BBC, RTL, KBS and all sorts of other big guys are still on the air.

OK, so we didn't really expect any final 2 a.m. signoff anytime soon. But what really was noticeable here was how robust some of the traditional broadcasters were looking as they face the meteor that was supposedly dooming them to extinction: the Internet and all things digital.

Certainly, CBS and Disney delivered the message that this digital thing is an opportunity, not a threat. Compared to MIPCOM a year ago -- when Google had just announced its $1.65 billion YouTube acquisition and TV execs were running around declaring that the industry had gone schizophrenic -- TV bosses here were espousing more self-assured rhetoric.

No one strutted his digital stuff more than CBS CEO Leslie Moonves, who said, "We're striking back against this narrow view that the TV network is doomed."

Confessing that CBS not too long ago had indeed "resented" the rise of the Internet, he told the doomsayers to take a walk. If broadcasters are dinosaurs, then they're "raptors maybe, the kind who survived," he said, noting that CBS would be one that would evolve into a thriving bird, as some scientists believe happened with the more nimble Jurassic creatures.

Why so confident? Not because the overseer of "CSI" and the NCAA men's basketball tournament thinks that the public has ended its fascination with the Internet. Sure, people will still watch from the comfort of their sofa, but Moonves now readily accepts that they'll watch on their PCs, phones, iPods or the gadget du jour. In a lively, upbeat keynote Monday, he put it in plain biz speak: "It's more revenue."

CBS sees all these new gizmos as more distribution platforms to which CBS can sell advertising-funded content. CBS also will offer Internet content on a subscription basis, but, he said, advertising probably would emerge as the dominant revenue source. As an indicator, he noted that revenue from CBS' online streams of NCAA March Madness games increased fourfold when CBS switched from a pay model in 2006 to ad-supported in 2007.

Over at Disney Media Networks, online advertising also makes sense to Ben Pyne, president of global distribution. He says that "87% of people who watch a show streamed remember the advertiser." That, he says, is why advertisers are willing to pay a premium for online space.

It seems to be working. According to Pyne, Disney has streamed 140 million pieces of content since introducing the ABC.com online player a little more than a year ago. And in a surprise development for a young technology, it's even been profitable.

Of course, there are possible fissures with traditional customers like pay TV companies that could find content they've bought from ABC appearing online. "When we announced, a number of us were marked people," says Pyne, who claims that ABC has avoided undermining its customers' shows.

Back at CBS, Moonves clearly is counting on online ad revenue. It helps explain why this year CBS purchased a stake in newfangled digital distributor Joost, which, for all its maverick approach to using P2P technology to support full-screen display of videos on PCs, practices a business model as old as commercial television itself. Joost acquires content and sells advertising around it. It's the same model that Joost's counterpart Babelgum hopes to deploy as it kicks off a Spike Lee-fronted film festival.

An age-old business model tweaked for a new age? Hmmm, maybe those dinosaurs really did evolve into flying feathery things after all.