It wasn’t that long ago that America Online was being treated as a joke — a once powerful online brand that fell on hard times and saw its membership flee in droves.
Now, “at any given point in time during the day, we have as many or more people as any given television network,” said David Eun, president of the revamped AOL’s media and studios division.
AOL, like Hulu, and soon Apple TV and Google TV, and other fast-growing online ventures, are keeping Hollywood executives on their toes and forcing them to figure out how to effectively utilize those digital platforms to generate new sources of revenue or risk losing more of their TV channels’ viewership to other forms of entertainment.
“Scripted content of any kind cannot be profitable on a single window,” John Landgraf, president and general manager of FX Networks, said Monday during Variety’s Entertainment & Technology Summit. “What’s happening is people are trying to figure out a windowing strategy. Ultimately what sustains this business is a bundled model.”
Landgraf was one of several Hollywood execs on hand at the daylong conference at Loews Santa Monica to stress that success in today’s ever-changing entertainment biz requires programming to be sold across multiple platforms.
But there is a limit to pushing it out onto various dotcoms too quickly.
“Conditioning people to get high-quality, expensive stuff for free isn’t good,” said David Nevins, prexy of entertainment for Showtime. “My job is to make expensive stuff and get people to pay for it.”
Landgraf was also vocal about relying too heavily on Web distribution, especially for free. “The Internet has this breed of commentator — the self-righteous thief,” Landgraf said, who likes to say, “‘You make me steal.'”
Instead, Hollywood needs to find the right balance. Hulu, which Hollywood’s studios helped launch, may not be the answer.
“Hulu was a startup idea that became its own worst enemy,” said Michael Wright, executive VP, head of programming for TBS, TNT and TCM. “It was too good. Until it can monetize itself and make us feel good, it will cool off.”
The adoption of new digital platforms comes as webheads are still trying to get a grip on the traditional TV biz. Cable execs on Monday weren’t applauding the continued hemorrhaging of auds from broadcast channels.
“The existence and health of the four broadcasters is necessary for all of us,” Landgraf said. Their success may first come down to figuring out what audiences want to watch.
“‘Lone Star’ is the best example of a cable show on a broadcast network,” said Wright. “A show like that needs to breathe,” but the pressure of keeping advertisers happy forced Fox to pull the plug on the drama sooner than a cabler would have.
Branding is also important, with the SciFi channel’s subtle switch to Syfy having already helped the network broaden its audience.
“I’m a firm believer that had ‘Battlestar Galactica’ been on another network, it would not have broken out the way it should have,” said Mark Stern, executive VP of original programming for Syfy and co-head of original content for Universal Cable Prods.
Still Stern, along with other panelists agreed that it’s become harder to assess the success of a show because of the increased usage of digital video recorders.
“It’s very difficult to get off the crack pipe of overnights and nationals because people like to talk about those numbers,” Nevins said.
Moving into producing more reality programming has become the answer for USA Networks.
The difficulty with reality, however, is “repeatability,” Wright said. “It wears out after a couple runs.”
Former Disney chief Michael Eisner is going after those auds in various new media ways.
Eisner, who served as one of the confab’s two keynote speakers, has been able to turn his Tornante Co., named after signs he saw while on a bicycle tour of Italy, into a venture that’s capitalized on the production of Web series and is now creating games for such sites as Facebook.
“Technology has opened a new way to play,” Eisner said.