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With TV Everywhere, pay-TV industry seeks to fend off an Apple invasion

Fearful that they'll suffer the same fate as the music business, television firms are racing to come up with services such as TV Everywhere, which would let paying customers view shows on any device.

May 12, 2010|By Dawn C. Chmielewski and Meg James, Los Angeles Times

Seemingly minor issues — such as whether online viewers would be part of Nielsen's program ratings, or whether the same TV commercials would appear online — have stymied the process. Even the partners have debated whether to allow heavily trafficked portals, such as MSN or Yahoo, to be included.

And only one of the four major broadcast networks, CBS, is participating in the trials.

The three other networks — ABC parent Walt Disney Co., NBC Universal, and Fox parent News Corp. — are owners of Hulu. Hulu's owners plan to begin offering a premium service for $10 a month that would provide a greater library of TV shows to watch.

One person familiar with the issue said those networks aren't part of TV Everywhere because, initially, they didn't know what it was going to look like. But now it appears they're holding back online distribution rights as leverage in the retransmission fee negotiations.

ABC is in an unusual spot. Although parent company Disney is a partner in Hulu, its largest individual shareholder is Steve Jobs, the head of Apple. Not surprisingly, ABC was the only broadcast network to have an app on the iPad when it debuted for users to watch ABC shows.

While the cable industry sees TV Everywhere as a way to offer subscribers broad access to programming online, others see a far more sinister motivation: snuffing out free online TV. Their fear is that the cable industry is determined to maintain its control as television gatekeeper, locking out competition.

"TV Everywhere is just a tactic to keep people paying," said Mike Vorhaus, president of Magid Advisors, a media consulting firm. "The cable companies want more customers. They want to build a wall and penalize us if we don't pay."

But a wall that keeps out nonpaying viewers is exactly want Bewkes wants. And he thinks the threat of cord-cutting is pretty much bluster in a country where 93% of households pay to get TV.

"The viewing of television is going up, not down. More people are paying for it and watching it, in terms of absolute millions of people," Bewkes said. "What we're saying now is, let's take that very powerful incoming tide of TV and put it online."

dawn.chmielewski@latimes.com

meg.james@latimes.com

Times staff writer Joe Flint contributed to this report.

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