With retrans deals afoot, nets seek fees for online access to shows

The prevailing winds in the network and cable programming world are buffeting the latest effort to marry off TV and the Web once and for all.

Google let it be known last week that ABC, CBS and NBC are blocking online viewing of their shows via the fledgling Google TV platform. The nets, in response, made it clear that they expect to be compensated for the privilege of allowing Google TV users easy online access to the programs that each net makes available through its own website, Hulu or another Internet distrib. The nets’ themselves can be accessed via Google TV, just not the content on their proprietary websites.

Net execs were bemused by the breathless media coverage late last week of the blocking effort because none of the Big Four nets has yet formally signed on as a Google TV partner. Google’s partners to date include the HBO Go service, available only to subscribers of the pay TV powerhouse. Turner’s TBS and TNT are onboard through their TV Everywhere platform that allows users on-demand access to shows via broadband, so long as they maintain a cable, satellite or telco subscription.

NBC Universal has created a data-driven CNBC financial news app for Google TV, but you won’t be able to stream “The Office” or “30 Rock” through the platform — at least not yet. In fact, the mood in network suites is to become more restrictive with the volume and the time frame in which shows become available on the Web (typically 12-24 hours after the premiere telecast). Hulu, of course, has also embarked on a search for profits by implementing a $10 monthly fee for all-you-can-use access to most new and selected vintage shows from its partners (NBC, Fox and ABC).

“We’ve had discussions with Google, and have partnered with them on a CNBC app, but like many other content providers, we’re still evaluating their new platform in regards to other content,” NBC U said in a statement.

Google noted in a statement that it is still in the early stage of developing its TV navigation service. The company is clearly banking on the platform growing into an important promotional and distribution platform for entertainment fare. For now, however, Google TV is caught in the crossfire of shifting business paradigms and traditional Hollywood’s focus on squeezing more coin out of Internet distribution of its wares.

“We are excited about the opportunities our new platform creates for both established media companies like Turner and HBO, and tens of thousands of content creators large and small,” the Google statement said. “Google TV enables access to all the Web content you already get today on your phone and PC, but it is ultimately the content owner’s choice to restrict users from accessing their content on the platform.”

Word of the nets’ move to restrict Google TV’s access to online content spread quickly on the heels of the uproar among pols and media watchdog orgs over Fox’s move to block Cablevision broadband subscribers from accessing shows via Fox.com and Hulu. That blackout was briefly implemented Oct. 16, in the heat of the first day of the retransmission consent battle that pulled the curtain down on Fox’s New York and Philadelphia stations for Cablevision’s 3 million subscribers. (Fox backed off amid a quick outcry from watchdogs and concern about political ramifications.)

Retrans deals for Fox and other broadcasters are Exhibit A as to why broadcast nets in particular, and TV programmers in general, are skittish about extending their reach online at the moment. Stations affiliated with the Big Four networks are asking for real money (50¢-$1) in subscriber fees from cable and satellite operators for the right to carry their signals. (Hence Fox’s standoff over price with Cablevision.)

The increasing online availability of TV programming is already a threat to the old-guard subscription TV world. Making it even easier for viewers to find and watch programs online via a service like Google TV is anathema to cable ops and satcasters. The angst over the potential for leading-edge broadband services to encourage viewers to drop cable and sat-TV subscriptions altogether is what drove Time Warner CEO Jeff Bewkes to develop the TV Everywhere concept of tying broadband availability to subscription TV service nearly two years ago.

HBO Go is just getting off the ground, as is TNT and TBS’ TV Everywhere offerings. Programmers and operators have slowly been getting the word out to consumers as systems come online. Satcaster Dish Network, for example, added the Turner nets to its DishOnline service last week.

For Google TV, users have to buy a high-end Sony TV set, Blu-ray player or a special set-top box for about $300, so its aud is likely to remain small for some time. But the nets see it as a bid for Google to make money from hardware and build a potentially competitive TV platform. With Google’s stock price sitting pretty at $600-plus, none of the nets is inclined to do the company any favors with their content.

However, the Google TV-net flap comes as Congress and regulators scrutinize the Internet video marketplace as part of the Comcast-NBC Universal merger review. Concerns about Big Media exerting too much control over the cyber-vid biz could spur regulations that require the major broadcast and cable nets to make a certain portion of their programming available for free viewing via the Web.

It’s unclear how actively Google is negotiating with ABC, CBS or NBC. Fox is allowing access to its shows but has cautioned Google that it may eventually change its stance. Reps for ABC and CBS declined to comment.

Richard Greenfield, analyst for BITG Research, is a keen observer of the struggle for TV programmers to make money through Internet distribution of their high-priced programming. Amid the retrans battles for the major broadcasters, putting too much content online for immediate viewing, even with embedded advertising, undercuts their business and their rationale for seeking top dollar from subscription TV providers.

“We find it harder and harder to comprehend how broadcast television stations can demand retransmission consent fees from multichannel video providers, but at the same time place their content online for free,” Greenfield wrote in a research note titled “Broadcast TV Manifesto: If You Want to Be Paid Like Cable Nets, Start Acting Like Cable Nets on the Web.”

“While we acknowledge that the greatest value from retrans is access to sports programming (NFL, MLB, etc.) and other live events (‘American Idol’ finale, Oscars, etc.), none of which are streamed online for free, how can broadcast TV stations (and in turn broadcast networks) maximize value when so much content is being given away?”

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