The Internet-TV scene keeps getting more and more interesting — and expensive. Just weeks after HBO broke the proverbial dam, announcing it would break free of cable and offer up its prime catalog of content through an online-only service, outspoken CBS CEO Les Moonves announced its premium channel, Showtime, will follow suit.
First reported by the Wall Street Journal, Moonves announced the move Wednesday at a CBS corporate earnings call, saying Showtime will “fairly definitely” make the move to the Web, offering a monthly subscription service without the need of authentication through a cable of satellite subscription.
The news comes as little surprise in the backdrop of the ever-evolving Web TV landscape, as CBS already pulled the trigger on a standalone service for its network programming, releasing a bottled and ready-to-ship offering that went live for viewers just one day after HBO made headlines for its anticipated transition online for a cost of $6 per month.
As the voices of cord-cutters — those with broadband who have dumped traditional pay-TV services — have become louder and more persistent in the Netflix era, the desire to cultivate the still-fertile soil of an estimated 10 million or more households who have given cable and satellite the pink slip has become irresistible. And it has to be, as services like HBO still make their nut on the lucrative fees they pull in from cable and satellite services, worth billions of dollars of revenue each year.
As the dream of a buffet of choices from which viewers can build their own a la carte Internet TV package begins to take shape, it also becomes increasingly more apparent that, in order to get a well-rounded selection of content, cord-cutters will have to pony up a healthy chunk of dough. There is no word as to what Showtime (or HBO) will charge for its standalone offering, but it is expected to cost users about the same as the price of adding a premium channel to a traditional TV service, perhaps somewhere between $15-20 per month.
Adding one or two premium channels to staples like Netflix, Hulu Plus, Amazon Instant, as well as sports packages like NFL Sunday Ticket, or the forthcoming NBA package from ESPN, it’s easy to see how Web-TV may quickly become as expensive as mid-tier cable or satellite packages. All-in-one offerings likely won’t be much cheaper either, as Sony’s forthcoming Internet TV package is rumored to cost as much as $80 per month –if and when it surfaces, that is.
According to a report by Broadcasting and Cable, Moonves also told investors CBS has agreed to license its content as a part of Sony’s new service, which has already inked a deal with Viacom. “And as new entrants they will pay us higher subscription fees than we’ve ever been paid before,” Moonves said, again underlining the difficulty in creating an all-encompassing Web-TV service.
However, whether viewers choose an all-in-one, or an amalgamation of many services, the true victory for Internet-TV may not be a price reduction, but a more effective method of control for viewers, who will be able to pick and choose programming as they see fit, dropping or adding from the available list at their leisure. We’ll have a much better idea of what a loaded Internet-TV package will cost when more of these services make their appearance in 2015. Until then, one thing’s for sure: The age of Internet TV is upon us.
Updated 11/6/2014: This report was updated to include details about CBS’ plans to add content to Sony’s forthcoming Internet-TV service.
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