By the Blouin News Technology staff

Cablevision suit highlights shift in content-consumer dynamic

by in Media Tech.

Sumner Redstone gets a star on the Hollywood Walk of Fame on March 30, 2012. Getty/ Alberto E. Rodriguez

Cablevision, the New York-based television distribution company, sued Viacom for monopolizing its ownership of content. Cablevision claimed it was forced to carry 14 of Viacom’s unpopular channels in order to get the rights to sell its most popular channels, Nickelodeon, MTV and Comedy Central. Viacom called the lawsuit a transparent attempt to invalidate a two-month-old agreement, which Cablevision made in haste to avoid a long-term blackout of its channels.

Regardless the lawsuit’s initiating factors, it’s suggestive that things have changed in TV Land. It could possibly yield welcome results for consumers who want greater granularity in their cable-package selections. It also points out an inherent problem of bundling in our era: namely, almost all types of entertainment are available on demand, at every scale — up to and including very, very micro versions (think GIFs and now Vines). Even the most popular channels are rarely bought for the entire stream; most subscribers just want some subset of their content. Prior to widely available streaming media, the value of television as an ongoing service was never questioned. The availability of shows on Netflix, iTunes, and other video outlets leads consumers to question even how much those popular channels are worth.

For that very reason, Viacom exercises tight control over its content. The company asked Cablevision in 2011 to withdraw its Optimum app, which streamed content to home cable subscribers on tablets. Other media companies have acted in a similar manner. IFC, AMC, CW and Bravo allow their shows to be purchased (and sometimes streamed for free) on Netflix and iTunes, but with delays (these can be as short as week or as long as an entire season) after the episode is aired. Hulu, an ad-supported freemium platform that runs shows from several networks including NBC, Fox, and ABC seems to make the most sense: it provides access to new episodes at no cost, but consumers pay for archive privileges, so to speak. (Hulu has, unsurprisingly, faced a lot of resistance from content companies who don’t want non-cable-subscribers to access their content.)

Content companies could benefit from giving the pay-per-view and online viewing models serious consideration, especially as a decline in television viewership is threatening their business model. In 2011, one million households dropped their cable subscriptions. Not a death knell, but not good — especially if the pace ticks up, which, as streaming content providers grow and license ever more content, is not beyond imagining. And the fundamental shift here, perhaps, is that content production itself has become more competitive: anyone with a half-decent camera in their phone can create video which hits socially-powered viewership heights undreamed of by most traditional media makers. Sumner Redstone, in other words, has a lot to learn from Filthy Frank, the man behind the Harlem Shake phenomenon. Seems unlikely he’ll listen, somehow.