This article by Mark Walsh from Online Media Daily poses that very question. Analyst Laura Martin, who works for Soleil Securities, estimates that Hulu will cost TV networks $920 in advertising dollars.
The continued success of Hulu and others will increasingly tempt people to give up their $100 cable subscriptions and just go with what’s online. The funny thing about it, is that Hulu is owned by NBC Universal – a network which had to scrap all of its network 10pm programming for the Jay Leno show because of declining ratings.
I haven’t had cable for almost 7 years – which is incredibly funny considering that I’ve WORKED in cable for the past 7 years at Lifetime and Oxygen Media. I even have a hard time watching regular television because I will not watch a 1 hour television program that is 17 minutes of commercials (YES, 17 minutes at the very LEAST). An online program has maybe 4 commercials in it – 1 at the top and bottom, and maybe 1 if you have to refresh the screen. So yes, I missed SUnday’s VMA’s and I had to hear all the gossip from people at work.
When you pay a $100 cable bill – that money is divided between the provider (Time Warner or Cablevision i.e.) and each cable network. For instance, ESPN gets $2 a month, Lifetime – maybe $1.00, Golf Channel – maybe .40 cents. No way I’m paying for cable channels that I have no interest in watching. I’d rather pay for the channels that I will watch. Since the cable networks won’t allow for a scenario like that, I’d rather just watch the programming I want to watch online or even at the gym.
I’m about to catch Beyonce teaching Kanye West a lesson in respect by going online to MTV or Youtube and watching her speech at Sunday’s VMA’s. Kanye – please, stop drinking Henessey in public. Your little 10 year-old self would not be happy if someone had done that to New Edition 20 years ago.
For more about ‘a la carte’ cable buying:
Why Mandate A La Carte Cable When It’s Happening Online Already?http://www.techdirt.com/articles/20081117/0118352846.shtml