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Fox restricts free online access to its shows

Beginning Aug. 15, viewers who don't subscribe to a participating cable or satellite service will have to wait eight days to watch a new episode of Fox's shows on websites such as Hulu.

July 27, 2011|By Dawn C. Chmielewski and Ben Fritz, Los Angeles Times
  • New Directions performs in "The Rocky Horror Glee Show" episode of "Glee." Fox is restricting free online access to Glee and other popular shows.
New Directions performs in "The Rocky Horror Glee Show" episode… (Adam Rose, Fox )

Fox is restricting free online access to "Glee," "The Simpsons" and other popular shows, becoming the first broadcast network to impose limits on watching new television episodes on websites such as Hulu.

Beginning Aug. 15, viewers who don't subscribe to participating cable or satellite services will have to wait eight days from an episode's initial broadcast to watch a current Fox TV show online.

Previously such popular prime-time shows from Fox and other networks have been available online the day after they aired for free, with commercials.

The latest move is part of a strategy called "authentication," which the television industry has been discussing for several months. It's part of the industry's attempt to preserve its lucrative traditional business, which generates revenue from cable and satellite subscription fees and advertisements.

The first pay-TV service to sign onto Fox's new arrangement is Dish Network. Its 14.2 million subscribers will receive a password to watch the programs via the Internet. No other cable or satellite company is part of the offering so far. Subscribers to Hulu Plus, Hulu's paid offering that has more than 875,000 users, will also have access to new Fox programs the day after they air.

Fox and other television networks worry that the growing popularity of services like Hulu, which allow millions of users to watch current TV episodes for free online, are encouraging consumers to cancel their cable or satellite subscriptions in a trend known as "cord cutting." That would jeopardize billions of dollars in revenue.

It's ironic that Fox has become the first broadcast network to erect a toll booth on the Web. The network's parent company, News Corp., joined with NBCUniversal to launch the free online offering Hulu in 2008 as a defensive move against Internet piracy.

But after the recession led to lower advertising revenue and tensions increased with the cable and satellite providers, Fox made a dramatic shift. To make up the difference, it began charging cable and satellite providers fees for their previously free broadcast signals. As part of those deals, Fox agreed to begin pulling back on its free online offerings.

Analysts say Fox's decision could contribute to the very problem Hulu was created to address.

"This move is likely to fuel an illegal market for Fox shows, because not everybody will necessarily have access to authenticated services. It feels like it's one step forward and two steps back," said Arash Amel, digital media research director for IHS Screen Digest.

Fox sought to portray authentication as a boon to consumers, saying it would expand their online access to the TV programming they already pay to receive. It is similar to how Time Warner Inc. described its HBO Go offering, which allowed subscribers to watch shows like "True Blood" online, on mobile devices and on Apple Inc.'s iPad.

dawn.chmielewski@latimes.com

ben.fritz@latimes.com

Times staff writer Meg James contributed to this report.

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