Fox will start streaming and selling its shows on the websites of its more than 200 affiliates under a new deal, the first time local stations will offer network programming both for free and for sale on their sites.
Fox has planned to cut a deal with its affiliates since it began streaming shows on its owned-and-operated stations' sites in August. Under the new deal, affiliates will also start streaming the shows and be able to sell local ads against them, in addition to selling the shows for download.
They will share revenues with the Fox broadcast network, the Twentieth Century Fox studio, and Fox Interactive Media.
Affiliates will be able to sell about 30% of the ad inventory in the streaming shows as local spots. That is similar to the deal ABC did with its affiliates in September 2006, which let them stream primetime shows. In hour-long dramas that stream on their sites, ABC affiliates can sell one ad, while the network sells three national ads.
Fox's deal builds uon a prior agreement it had worked out for with its affiliates under which they have received a minority share of revenues from content distributed elsewhere online.
Under the earlier deal, the affiliates saw a cut of revenue from Fox content streamed on the web in return supporting Fox's NFL deal, among other provisions.
Affiliates will now also begin selling Fox shows, including 24, Bones, and Prison Break, through the company's "Fox on Demand" players, and see a cut of whatever revenue that generates. Single episodes will generally go for the market price of $1.99 and full seasons for $30-40.
For a brief period of time beginning in May, 2006,
. It discontinued that model in favor of selling shows on iTunes, as well as Fox Interactive Media's iTunes competitor, Direct2drive.com, which also offers videogames and some movies.
While none of the other networks currently sell prime time shows on their sites (CBS had sold Survivor, but stopped), or their affiliates', Fox is doing so in addition to streaming them because for now, no one knows exactly which emerging media distribution model will yield returns.
"All of us are testing a number of models out and that's generally going to continue for the next year or so," says Ron Berryman, Senior VP/GM, Fox Interactive Media Stations Group.
Fox plans to begin rolling out the players on affiliates' sites by the end of March and to finish within three months.