It didn’t take long for *CBS* to issue a statement after Time Warner (NYSE: TWX) and Comcast (NSDQ: CMCSA) announced the upcoming national trial of TV Everywhere, expressing interest in anything “to help extend our business in such a way that is open and non-exclusive; consumer friendly; and responsible to our advertisers and shareholders.” The statement also said the opportunities with efforts like TV Everywhere and OnDemand Online “are the very reason why we believe it’s imperative to control our own programming online.” Then again, even though the network won’t confirm it, I have reason to believe CBS (NYSE: CBS) will be taking part in the trial.
Later in the day, I talked with Quincy Smith (pictured), president of *CBS* Interactive, who carefully explained when I asked about how CBS would work with authentication: “I think you can make an assumption that to the extent that authentication represents an additional way for CBS as a broadcaster to get paid, I think that’s very interesting.” CBS is the only major broadcaster without its own cable networks (the exception is premium network Showtime) and, as such, is the poster child for retransmission fees, asking multichannel providers to pay for distributing its free signal via cable, satellite or other means. That makes getting paid is the operative word here — in this case, for allowing a provider to directly deliver its broadband content.
CBS is also the poster child for putting a major sporting event online in its entirety, making every game of the NCAA Division I Men’s Basketball Tournament available live and on demand online with no subscription fees. What would happen to March Madness if CBS opted to be part of authentication? “March Madness is a good example of authentication,” Smith said, without directly answering the question. “It’s the same number of ads but just different ads. It is the broadcast television model brought on line. It’s kind of a case study. We’re getting opener and opener.” He cautioned against seeing authentication as closing access to anyone.
“We’re only talking about full episodes here,” Smith said. “We have all kinds of dimensions of content. News, sports and entertainment. Library and current.”
What does authentication need to work? From Smith’s perspective as “one” programmer: “You want to see that the technology is seamless, that the users are happy and that; there’s room for expanding the economics. And that Nielsen or something is getting smarter faster about how to count it all.” What makes him think it will work? “I don’t see any negative to it. No matter what, it represents new opportunities to get paid. It depends on how fast they get there. And there’s about 70 billion reasons of motivation to make this work.”
That’s the estimated value of the industry all of them, including Smith, are trying to protect.