While the broadcast networks and their affiliates try to navigate the murky waters of digital distribution, NBC and its affiliates unveiled plans Wednesday to launch a new co-owned broadband venture later this year stocked with video from the local stations. Executives stressed the portal will be different from video-sharing sites like YouTube.com and that it goes beyond streaming NBC shows online.
The venture, dubbed The National Broadband Company, will aggregate video from NBC’s 230 affiliates, such as clips on health, consumer news and entertainment. Future plans could possibly include user-contributed content and clips from NBC Universal’s library. The video would likely be ad-supported. It represents an early model of how local stations could make money of their rich library of video.
The news came after a meeting of NBC’s local affiliates Wednesday in New York. The NBC Affiliates Futures Committee, which includes representatives from local stations and the network, has been developing the new broadband business for about six months, and affiliates voted unanimously to move ahead.
Like digital weather channel NBC WeatherPlus, launched in December 2004, the new broadband channel will be co-owned by NBC and its affiliates and managed by the network. WeatherPlus is now available on stations covering 75% of the country. An online version, nbcweatherplus.com, recently launched and includes streaming video of the TV network.
But NBC and station owners were quick to to draw distinctions between NBBC and other broadcasters’ efforts to put their shows on the Internet and sell episodes on iTunes. Such deals have roiled affiliates, who want a cut of revenue from advertising and subscriptions. Last week, Fox cut such a revenue-sharing deal with its affiliates. Mackin said the NBC affiliates are discussing such arrangements with the network but that NBBC represents a much bigger opportunity for both sides.
“We are prioritizing NBBC compared to the revenue sharing on portable devices,” says Terry Mackin, executive VP, Hearst-Argyle Television and past Chairman of the NBC affiliates board. “As the market exists right now, the revenue would be a small opportunity compared to this business. Very small.”
NBC Universal Television Group President/COO Randy Falco said some deals at other networks – he didn’t name names, but clearly referring to Fox—“often come about as a result of crisis. They don’t talk to each other and then all of a sudden there is an NFL deal to negotiate or all of a sudden they have a new announcement about revenue sharing.” (The Fox news last week also included affiliates contributions to the network’s latest NFL deal.)
NBC and its affiliates, Falco said, emphasize ongoing dialogue and negotiations. “We’ve been in ongoing discussions about creating new businesses, new revenue streams and reinventing the partnership between NBC and its affiliates.”
Up next: conversations about NBC’s own NFL deal for Sunday Night Football, which kicks off this fall.