NEW ORLEANS — Jamie Kellner, chairman and CEO of Turner Broadcasting, told reporters at last week’s National Cable Show that Hollywood is scared out of its wits by what he regards as that evil little button on TiVo’s personal video recorder. That’s the one which allows the viewer to zap 30-second spots with the press of a thumb.
The major studios’ trepidation over TiVo can’t be overestimated: The remote-control button that liquidates blurbs has the potential to destroy the foundation of the ad-supported-network business, forcing people to pay a lot more for the shows they watch on TV.
But the studios are fighting back with a three-letter answer: VOD. That stands for video-on-demand, and it generated more buzz by far than anything else at the cable show in New Orleans (May 5-8), from panel sessions to informal dinners to corridor talk.
Bob Iger, president and chief operating officer of the Walt Disney Co., said at a big programming panel on May 7 that VOD is much more “compelling” than TiVo. Both allow the viewer to pause or rewind a program in real time, mimicking a prerecorded cassette in a VCR. But while TiVo can store only about 35 hours of programming at one time, VOD can warehouse thousands of hours in a file server at the cable system’s head end.
But both Tom Freston, chairman and CEO of MTV Networks, and Peter Chernin, president and chief operating officer of News Corp., cautioned the cable industry not to rush headlong into VOD without figuring out the best way to sell it to subscribers.
Chernin announced at the show that he’s experimenting with free VOD by agreeing to permit Chuck Dolan’s Cablevision systems to put Fox Entertainment’s rookie series “24” and “The Shield” into a VOD window.
During another panel, Brian Roberts, prexy of Comcast, which will become the biggest cable operator in the U.S. if its merger with AT&T gets Washington approval, said he’s launching a free VOD setup to subscribers in Philadelphia stuffed with 750 hours of programming drawn from broadcast networks and basic-cable channels.
Roberts is negotiating with the networks for programming like the latenight shows hosted by Jay Leno and David Letterman, the nightly newscasts of the Big Three and some of the news and business shows on CNN, Fox News Channel and MSNBC.
Extra VOD runs of these shows would perform a service because if subscribers miss the first play, the programs may never turn up again.
The Cable Show also delivered some high-wattage executive star power. Michael Eisner, chairman and CEO of the Walt Disney Co., attended his first cable show ever, submitting to reporters’ questions at the Disney booth on the convention floor and denying what everybody in the industry knows: that cable operators are pissed off at what they regard as the exorbitant license fees the company charges for ESPN and the Disney Channel. Eisner played the diplomat at a May 7 dinner with key cable operators, at a restaurant whose location was kept secret.
Richard Parsons, co-chief operating officer of AOL Time Warner, showed up both at an informal dinner engineered by Turner Broadcasting and at the big general-session panel that kicked off the show.
Making headlines across the country, Parsons said forcefully that the company has no plans to split AOL off from Time Warner, despite repeated calls from Wall Street, which has punished AOL TW stock for what he admitted were “overexuberant” promises of synergy that the merger company has failed to meet.
Wall Street is rapping the knuckles of most cable stocks, which are suffering along with many other industries in a still subpar economy. Attendance at the National Show mirrored this slowdown, dropping from last year’s figure of 24,000 to only about 17,000.