Time Warner Cable will launch free on-demand programming from Scripps Networks entities — Home & Garden Television, Food Network and Do It Yourself — as part of the MSO's 30-system digital video-on-demand rollout.
It's the first announced contract between Time Warner Cable and a major basic-cable programmer for free on-demand content on the VOD platform.
Under the deal, Scripps will supply 10 hours of programming from each network per month. The company will refresh six hours of that each week.
Scripps had offered its programming for between 99 cents and $1.49 in a recent test on Time Warner Cable's Cincinnati system, but opted to go the free on-demand route MSO-wide.
"The customer response to our VOD trials in Cincinnati proved that there is more than ample interest in our on-demand programming," Scripps senior vice president of new ventures Channing Dawson said.
Although Dawson said Scripps is talking with MSOs about subscription-VOD packages, the company believes free on-demand is an important first step to get consumers used to VOD.
"There is a natural obstacle to impulse buying. We saw that immediately," Dawson said of the paid trial that has run its course in Cincinnati.
Operators need to retain digital subscribers, and free on-demand can help that goal, Dawson said. "We believe you need a period where FOD is available so people can get used to it," he said. "The take rates are going to teach us a lot. With a price in front of it, you won't learn anything."
Although the product is free, Dawson said Scripps will experiment with ad placement in and around its VOD product, even with VOD's VCR functionality. Those ads could include billboards, 30-second spots, or long-form, informational ads at the end of a program, he said.
Since much of Scripps programming falls under the self-help category, associated advertising is often less onerous to its viewers. "In our world, that's a pretty interesting place," he said.
Scripps will take a cue from what worked well during its Cincinnati trial and focus on certain special-interest programming for the Time Warner rollout. "Radio-controlled hobbies were a very big hit for us in VOD," he said.
DIY's VOD content will be clustered into three areas: how to, hobbies and home improvement.
HGTV will feature gardening, decorating design, building and remodeling and crafts, while Food will have four clusters. "We've chosen to do it topically," Dawson said. In the VOD world, consumers respond to topics more often than network brand names, he said.
The content will be drawn from half-hour and hour-long shows, plus compilations. For example, eight kitchen designs might be grouped in one VOD offering, but with on-screen icons, consumers can fast forward to the design of their choice. Information on the companies and products used during the show will be put onscreen after each segment.
Step toward SVOD
Dawson sees free on-demand as an evolutionary, sampling step toward SVOD. Officially, Scripps is offering a 60-hour SVOD package — 20 hours from each network — for $1.99 to $4.99 per month. "We've talked to everybody about SVOD," he said, but there have been only two takers to date.
The content would be refreshed each week, meaning SVOD subs would get 100 hours a month, with about 150 to 160 titles to access. "That's the package we're looking at," Dawson said, with the revenue split with the MSO.
Scripps stores the programming on digital loop tapes, which are then shipped to California Video Corp., the Warner Bros. transmission house that ships content to N2 catchers at Time Warner headends, Scripps vice president of technology Harry Jenkins said. The tapes are also sent to TVN Entertainment Corp. for distribution to other MSOs.
Jenkins said that Scripps will eventually use Internet file transfer protocols to send programming to CVC and TVN.