BusinessInsider writes about the imminent demise of TV business models
This user behavior has been changing for a while, and, so far, it has had almost no impact on the TV business. On the contrary, the networks and cable companies are still fat and happy, and they’re coining more and more money every year.
But remember what happened in the newspaper business.
When the Internet arrived, user behavior started to change. It took a decade for this change in behavior to hit the business. But when it hit the business, it hit it hard–and it destroyed it shockingly quickly.
And the same thing seems likely to happen to the TV business.
Really good article especially when you look at the UK and more specifically the microcosm of Northern Ireland.
We have two ‘local’ broadcasters. The BBC and UTV. One of them is propped up by advertising sales via their profitable radio station segments. And the other is propped up by a mandatory tax levied if you own a television or computer.
On top of this we have Channel 4 and Channel 5 and then a multitude of Freeview channels.
I just wonder what will happen in the current market. Well advertising supported television die off as advertisers become more savvy to changing user habits? It seems to me that advertising supported channels (UTV, C4, C5) are making hay while the sun shines. Of the three only Channel 4 seems to have made any efforts towards changing models for the future.
And then we have the BBC. It will obviously break the mould for television business models due to the government subsidy from the ‘license fee tax’. Indeed, it seems well suited to weathering an upcoming storm though it has many faults. Not least the insistence that the intellectual property that it has within the archives is extremely valuable. I don’t deny these things have value but decades of poorly considered contracts and a lack of future-proofing have made their position untenable. We, the television-owning public in the UK, paid for all of this content once already. I can’t help but feel we’re being nickel’n’dimed now we want to view older content.
The shakedown of television is just beginning. And it will start with local channels and move to the larger national and international advertising supported channels.