Apple TV, Google TV, Hulu, Netflix — the world of digital television and movie viewing is growing, but the complete shift from broadcast and cable television to digital video still appears to be years away. Will it happen soon and who is slowing the shift down?
Paul Verna of eMarketer published his take on the shift last week, which is an interesting read. As you’d expect, the root of the delay is money. Revenues generated through ads and subscriptions in the online space simply can’t compare to the same in traditional broadcast and cable television.
But Verna goes a step deeper based on comments by former NBC Universal CEO Jeff Zucker, which he made during a speech at Wharton School of Business on September 29, 2010. Zucker suggested that another problem slowing the shift is the high salaries of actors and personnel that make television programming, including content owners, producers, writers, broadcasters, cable channels, and more (all of which are paid for by consumers and advertisers, notes Verna). Zucker explained, “There’s a lot of mansions in Hollywood built on preserving the old system.”
Undoubtedly, consumers demand will force the shift to online video with consumption occurring online and on mobile devices, but it will take time. However, the shift from broadcast and cable television to online video isn’t the first time in history that an industry has completely changed due to technological advancements and consumer demand. The print publishing industry finds itself in the same position. In the past, the telecommunications industry changed dramatically as mobile phone usage grew. Remember when people thought Bill Gates was crazy when he envisioned a day when everyone would have a computer on his or her desk? Could you imagine not having a computer today? The list goes on and on. The bottom-line is — you can’t stop progress.
What do you think? Will online video change the economics behind the television and movie industry in time? Leave a comment and share your thoughts.