Promoting the value of content and developing compelling
offerings for consumers is the key to helping the industry from tossing money
and premium content down the drain, according to Warner Bros. Chairman and CEO
Barry Meyer, speaking at the Broadcasting & Cable/Multichannel News
OnScreen Media Summit Oct. 21 in New York City.
“Something of value is generally not given away for free,” he said during a keynote Q&A with B&C Executive Editor Melissa Grego. “Just
because a consumer is watching on a mobile device or a Website doesn’t mean it
cost any less to produce the content.”
Because of the high cost of creating professionally-produced shows people want
to see, the industry can’t continue to exist in its current form when the
majority of content is available for free on the Internet.
Meyer stressed the urgency of finding a solution to this problem, saying it
should be done as quickly as it possibly can.
But, the challenge, Meyer said, is reconciling the need for viable economics
with customers growing desire for the freedom and flexibility of such mediums
as the Web, mobile devices and on-demand viewing.
He pointed to the authentication model, such as Time Warner’s TV Everywhere, as
a way to achieve this goal.
“If carefully executed, an authentication type of business model…can benefit
everyone and be an ideal complement to the current broadcast and cable
television ecosystem,” he said.
Meyer believes the customer will be amenable to an authentication system
because it is an added value made available to an already-paying customer.
“They pay for cable TV now. Why would they object?” Meyer said. “Convenience is
an added plus to someone who is a customer of the product.”
He also pointed to the importance of “windowing” content. By not making all
programming available at the same time on all platforms, the industry can
preserve the value of each unique part.
Meyer’s other suggestion for monetizing on-demand platforms is simply to charge
for it directly.
“Charge a monthly subscription for the ability to access high quality popular
programming on-demand on multiple devices with limited (or no) commercials,” he
said. “We devalue it when we let our best customers know they can watch without
commercials or paying a subscription fee.”
He cited the popular computer game World of Warcraft, which
customers buy for $60, then spend $15 a month to play online. Nine million
people play the game, predominantly millennials, the same demographic that many
executives say expect to get their content for free. The success of WoW seems
to undermine that argument.
While Meyer believes in an authentication model, he is less-inclined to support
an a la carte approach.
“It may not be the best thing to promote the diversity of content,” he said.
"Smaller niche channels…they will go away. I think it works to everybody’s