Ivan Fecan, CEO of CTV got it partly right when discussing the possibility of closing down their A Stations:
“This is not the fault of our hard working and dedicated employees who work at our A stations across the country. It is because the business model for conventional television is now broken.”
I say Ivan got it partly right because, I don’t think the business model for these smaller/speciality channels was ever feasible. There are just too many hands grabbing the small pie - be it the producers, on-air talent, content providers, cable/satellite operators, licensing bodies, etc.
Broadcasters have a dilemma ahead of them. On one hand, the viewing public wants speciality channels which speaks to their passions - their tribal channel. On the other hand, the traditional broadcasting/cable TV business model does not fit the need for smaller niches.
In other words, the more specialized you are the higher the value you are but to a smaller number of people. The more general you are, the less value you will be but with a higher audience.
The key to successfully accomplishing this is to shift the from the ‘Specialty Channel’ concept to the ‘Speciality Content’ concept. There are already some interesting business models in play:
- Many channels allow viewers to watch full episodes of their shows online
- Is it now feasible to exclusively do this?
- Cable operators now have a wide variety of paid and free content available through their on-demand services - thus viewers only pull what they want
