By offering single episodes of shows such as “The Office” or “The Simpsons” on-demand online — separate from cable, satellite or other pay TV packages — they [TV networks] are letting consumers watch the hits without funding other programming.
“As we’ve seen with music, when the consumer is allowed to buy fewer tracks (about 20% of the album), thereby generating up to 60% less revenue than in the bundle,” she wrote in the report titled “Content’s $300B Gamble.”
While online video CPMs have been 30% to 50% higher than for TV, each online episode carries only a quarter the number of advertising minutes as the on TV. Martin estimates that those figures add up to a 60% decrease in ad revenue when shows are moved from TV to the Web, unless the Internet actually expands viewership.
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