So I understand that business-wise it works and there is money to be made by charging people to watch TV, but I’m wondering what dish/direcTV/etc actually do in terms of innovating and getting entertainment on the air? My understanding is that the money from commercials goes straight to the networks, what incentive is there for the networks to not just allow free streaming on their websites so that more people see the show and the commercials in it?
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Cable companies, and satellite carriers like Dish and DirecTV are infrastructure. They carry content and charge a user fee for it. It’s up to the individual channels to innovate and keep viewers glued. No different than an ISP, they just bring you web content, it’s up to the websites to provide that content.
The channels carried by cable companies are paid a carriage fee, they basically get a cut of the subscriber revenue in exchange for licensing the right to rebroadcast or carry their content. This means the individual channels actually earn more when viewed over cable, rather than online from their own website.
It’s also worth considering that media licensing can be complex, and just because a channel can license content for broadcast, that license doesn’t necessarily include streaming rights. In most cases nowadays it does, but the channels have to include some form of geolimiting to ensure their streaming broadcast is only within the geographical area they’ve licensed the content for.
Cable is dying, but it’s a slow death. Cable infrastructure is solid and reliable, and pervasive in most populated areas. It still has a large user base and still provides lucrative revenue for channels. Advertising revenue is based on eyeballs, and cable generally delivers more viewers than an individual website alone would attract.
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