Fox to Put Shows Online in Deal With Affiliates
Fox Broadcasting said Thursday that it would soon make its popular prime-time programs, such as “24” and “Prison Break,” available on the Internet and video-on-demand services as part of a precedent-setting deal that shares revenue with its affiliate station groups.
Unlike its media rivals -- NBC, ABC and CBS -- which have miffed their TV affiliates by negotiating short-term arrangements to offer downloads on various other outlets and their own websites, Fox took a different approach. The company spent the last six months working to win over its affiliation station groups, which will share in the revenue Fox generates.
“We wanted to be partners with our station groups rather than being at odds with them,” said Tony Vinciquerra, president of Fox Networks Group.
As a result, Fox will be able to offer more of its shows for next-day downloads.
Walt Disney Co.’s ABC has been the first to make its shows, “Lost” and “Desperate Housewives,” available on the Internet, but its current arrangement with its affiliate stations prevents ABC from “repurposing” more than 25% of its prime-time schedule.
TV station owners, who have long enjoyed the exclusive right to first broadcast new episodes, are afraid that they will lose viewers if more people turn to the Internet for their entertainment. Lower ratings would undermine the stations’ ability to maintain and raise advertising rates.
The networks’ race to embrace new media comes at a bad time for TV stations, which have watched their earnings slip during the last year as leading advertisers steer more of their dollars to the Internet.
Under the previous agreement, Fox, part of media giant News Corp., would have been limited to using just four hours of its prime-time programming on other outlets. The six-year deal with the stations will allow Fox to use six hours of programming initially and 100% of its prime-time schedule by the third year of the contract.
“This deal provides us with maximum flexibility to make our content available across all of the different new-media opportunities,” said Peter Levinsohn, president of digital media for Fox Entertainment Group. “And what’s really great about this deal is that our affiliates will be partners with us so our relationship will be substantially more collaborative.”
For example, some of the shows might be made available for download on local affiliate station websites to help drive their traffic, Levinsohn said.
As part of the deal, the stations agreed to continue to help pay a portion of the $713 million Fox must pay the National Football League each year under its contract.
“Everyone will be working toward the same goal, which is to maximize the value of our content,” Levinsohn said. “I’m sure that this where the industry is going to go.”
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