Time Warner (TWX) units Warner Bros. and America Online are set to announce a broad agreement in which a significant chunk of the studio's old TV programming will be made available as free streaming via the online giant, according to executives familiar with the matter.
The announcement could come as early as Nov. 14. The expected move will mark another major attempt to move TV content into next-generation distribution realms. In recent weeks, NBC Universal (GE), CBS (VIA), and ABC (DIS) have all struck deals to make their current TV programming available through a wide range of on-demand applications. ABC has partnered with Apple's (AAPL) iTunes, CBS with cable giant Comcast (CMCSA), and NBC with satellite provider DirecTV.
Though the volume of content Warner Bros. will make available may well be impressive, the deal's contours will differ from the networks' recent plays in one key area: No current shows are involved. The available material is from the Warner Bros. libraries, distributed through its domestic cable division. The deal also doesn't involve the WB network, which is another Time Warner property.
JUST FOR PUBLICITY? An executive familiar with the matter says one show that will be made available via AOL, for example, is the mid-'70s sitcom Chico and the Man, which starred the late Latino comedian Freddie Prinze. An AOL spokeswoman declined to comment for this story.
The Warner Bros.-AOL agreement underscores TV's fervor to hop into new-media distribution models, even if cynics look at the relative modesty of such efforts and suspect they're mostly done for publicity value. For instance, a vast trove of old TV shows is already available via DVDs and video.
Still, all signs point to the dislocations traditional media models face with fast-growing on-demand services and the ubiquity of broadband (see BW, 11/21/05, "The End of TV (As You Know It)").
"CHOOSE YOUR DEVICE." One consultant says media players' recent moves testify to how the nascent on-demand TV model is already in a second generation of sorts. The movement began with the launch of digital videorecorders like TiVo (TIVO). The recent announcements amount to "the next extension in the personalized liberation from the confines of traditional programming schedules," says Brent Magid, CEO of research consultancy Frank N. Magid Associates. Taking TV programming to iTunes or AOL now means "you can choose your device" on which to view it.
While ABC's deal to sell downloads for Apple's new video iPods initially raised eyebrows over that device's small-screen format, Magid cited his firm's research showing that it's better to consider iPods as portable hard drives rather than mini-TVs. "Seventy percent of those downloading [video content to iPods] are downloading it to watch on their PCs."
While the Warner Bros.-AOL deal may not boast TV shows of the moment like Desperate Housewives, at least it gives Time Warner a presence in the TV business of tomorrow.
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Fine is BusinessWeek's MediaCentric columnist and Fine On Media blogger
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