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Operators high on VOD - Broadcasting & Cable

Operators high on VOD

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Chicago - While Hollywood studios hedge the impact video on
demand will have on their revenues, cable operators on
a panel at the National Cable Show said they are
charging forward with VOD deployment.

"When you begin to roll out VOD in substantial numbers they begin to say 'We're missing an opportunity'," said John Hildebrand, vice president of multimedia technology for Cox Communications. "That will cause them to be more aggressive with their negotiations for titles."

The studios are waiting for wider distribution to monetize the value of VOD. They are apprehensive that VOD will eat into their profits from home video, which account for 51% of domestic revenues. They also are concerned about progressive videos for distributing movies on VOD.

VOD services are currently limited to a few test markets per cable system, but operators have plans for aggressive deployment in the next 12 months. - Allison Romano

Without hit movies, most VOD programming will come
from subscription VOD, such as HBO and Showtime, and
programming specials, including sports and adult
movies. In Demand, which is owned by the major cable
companies, is negotiating with the studios on behalf
of the systems, but the affiliates cut their own SVOD
deals.

Operators on the panel said also will need to address
programmers concerns that VOD will cut into their
linear programming and ad sales.

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