News

VOD Key to ‘Nurturing’ Cable Subscribers

6/14/2010 10:30 AM Eastern

Philadelphia — Cable’s free video-on-demand services
are an increasingly critical component that reinforces the
value of the TV subscription, according to a panel of industry
executives at On Demand Summit 2.0.

For Rogers Communications, offering free VOD is a key part
of “sustaining and nurturing our customer relationships,” said
David Purdy, vice president of television and video product
management — particularly for those under 25, who see cable
services as less relevant than older consumers.

The Toronto-based cable operator, the largest MSO in Canada,
is offering every World Cup match on TV, mobile and broadband
on-demand so customers should “not miss a single goal, a
single red card,” Purdy said.

“Everything we do at Rogers is about extending the existing
customer relationship,” he said.

Bob Watson, Time Warner Cable’s vice president of programming
and new business development, agreed that free video-ondemand
is a hugely popular element of the video subscription.

“People are looking for more value, and they are getting that
from that type of programming,” he said. Time Warner Cable
offers about 10,000 hours of VOD, which is mix of transactional,
subscription and free content.

Univision Communications, for its part, is gearing up a huge
VOD push for the World Cup, making hundreds of hours of coverage
available free on-demand 24 hours after the matches appear
on linear. “For us it’s all about introducing VOD to our
audience pretty much for the first time,” said Tonia O’Connor,
executive vice president of distribution sales and marketing.

At the same time, there’s a prime opportunity for cable to increase
transactional revenue from VOD for movies, especially as
the physical movie-rental stores are closing, said Alex Fragen, Summit
Entertainment’s president of domestic television distribution.

“If the customer wants to watch something it needs to be
available,” he said.

Added Purdy, “There’s a huge community out there that will
never go to the cinema. But they’re willing to pay a premium for
that movie day-and-date. ... They’ll pay multiples over what they
currently pay for VOD.”

But the panelists also said VOD interfaces remain a barrier
to wider usage.

“The challenges are navigation,” said Sandy Wax, president
and general manager of PBS Kids Sprout. She also urged all parties
to agree to share competitive usage data for the benefit of
VOD ad buyers.

Cable operators should be providing an “E-ZPass” for customers
to watch any video they want, Watson said, referring to the
automated highway-toll payment system on the East Coast: “Just
make it available to me.”

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