Zero TV Households

media convergence(Community  Matters) Lots of conversations lately about media convergence and how content + distribution channels = product.

Politico Playbook — Tech upstarts threaten TV broadcast model,” by Reuters’ Liana B. Baker and Ronald Grover: “Two fledgling technologies could dramatically reshape the $60 billion-a-year television broadcast industry … On April 1, a U.S. appeals court rejected a petition by the major broadcasters including Comcast’s NBC, News Corp’s FOX, Disney’s ABC and CBS, to stop a service called Aereo, which offers a cut-rate TV subscription for consumers by capturing broadcast signals over thousands of antennas at one time. … In November, a California court struck down Fox’s request to ban Dish Network’s ad-eliminating video recording device called the Hopper. The two services strike at the heart of the TV broadcast model, whose future will be up for debate at the National Association of Broadcasters show, which 90,000 people were expected to attend in Las Vegas this week. …

“[B]roadcasters fear the services will continue to expand, cutting into their viewing audience and advertising revenue. Even though courts have made preliminary decisions in favor of Dish and Aereo, both cases are still in the early stages and those decisions could ultimately be reversed. … A favorable outcome for Aereo and the Hopper in court would push TV operators to dramatically reshape themselves. It could even force them to trade in their broadcast towers and become cable channels alongside networks such as Bravo, AMC and ESPN, says Garth Ancier, who has been the top TV programmer at Fox, NBC and the WB networks. …

“Some of the top four major networks have been considering just such a move for months, and the emergence of the two technology threats could accelerate their decisions, according to Ancier. That would keep the broadcasters’ signals away from Aereo and their ads free from the Hopper, which for now only zaps broadcast ads in recorded television. … Broadcasters would have to turn their backs on the 11.1 million homes that Nielsen estimates still receives their TV signals from rabbit ears and rooftop antennas.”

–“Broadcasters worry about ‘Zero TV’ homes,” by AP’s Ryan Nakashima in L.A.: “A growing number of [people] have stopped paying for cable and satellite TV service, and don’t even use an antenna to get free signals over the air. These people are watching shows and movies on the Internet, sometimes via cellphone connections. Last month, the Nielsen Co. started labeling people in this group ‘Zero TV’ households, because they fall outside the traditional definition of a TV home. There are 5 million of these residences in the U.S., up from 2 million in 2007. … While show creators and networks make money from this group’s viewing habits through deals with online video providers and from advertising on their own websites and apps, broadcasters only get paid when they relay such programming in traditional ways. Unless broadcasters can adapt to modern platforms, their revenue from Zero TV viewers will be zero.

“‘Getting broadcast programing on all the gizmos and gadgets — like tablets, the backseats of cars, and laptops — is hugely important,’ says Dennis Wharton [of] the National Association of Broadcasters. Although Wharton says more than 130 TV stations in the U.S. are broadcasting live TV signals to mobile devices, few people have the tools to receive them. Most cellphones require an add-on device known as a dongle, but these gadgets are just starting to be sold. … Last year, the cable, satellite and telecoms providers added just 46,000 video customers collectively … That is tiny when compared to the 974,000 new households created last year. While it’s still 100.4 million homes, or 84.7 percent of all households, it’s down from the peak of 87.3 percent in early 2010.”


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