Internet Business Models for Broadcasters: How Television Stations Perceive and Integrate the Internet

By Chan-Olmsted, Sylvia M.; Ha, Louisa S. | Journal of Broadcasting & Electronic Media, December 2003 | Go to article overview
Save to active project

Internet Business Models for Broadcasters: How Television Stations Perceive and Integrate the Internet


Chan-Olmsted, Sylvia M., Ha, Louisa S., Journal of Broadcasting & Electronic Media


**********

The exponential growth of the Internet has changed the rules of competition in many industry sectors. The "reach" and "speed" of the development, coupled with the unique characteristics of interactivity and personalization, amplify the need for innovative business strategies from the competing media incumbents in their attempt to counter or leverage the rising popularity of this new market entrant.

The strategic importance of the Internet is especially evident for the television industry as television and the Internet develop a symbiotic relationship with significant financial implications. Television provides the most desirable marketing communication channels for Internet marketers. With millions of Web sites available, the Internet is the most cluttered medium in the world. To succeed in marketing an online brand, a marketer most likely will need to distribute messages via a mass medium such as broadcast television to create broad awareness of the product or service, or use a niche medium such as cable television to connect with target markets.

On the other hand, the increasingly critical role of the Internet in American media consumers' daily lives has led to a re-orientation of business strategy and operations by the leading "mass" medium, television broadcasting. For example, both television stations and networks now frequently cross-promote their online and offline content, especially for news and sports-related television programming (Greene, 2000). NBC recently launched a multi-platform advertising plan to focus on cross-platform advertising sales using its cable and broadcast networks, television stations, and Internet properties in an attempt to move away from an ad-reliance business model and reshape its business into a more interactive lifestyles management, information, and entertainment company (Mermigas, 2001). Disney and Fox formed a joint venture, movies.com, to distribute movies digitally through broadband Internet connections or cable video-on-demand services (Healey & Verrier, 2001). With the arrival of digital television, many television broadcasters are contemplating the feasibility of Web-enhanced applications such as on-screen links to advertisers' Web addresses, localized news services, late-breaking news, sports statistics, interactive polling, background to documentary material, online chat, and links to movie trailers and ticketing services (Nelson, 2001 ; Pavlik, 2001). There has also been a shift in the thinking of leading Internet television companies towards using the Web to enhance the viewing experience, rather than using the television as merely an alternative Web access device (Thompson, 2000).

As revolutionary as the Internet is for the television industry, few studies have examined the changes in business models, operations, and perceptions in response to the Internet among the broadcast media incumbents. Media scholars have mostly investigated the impact of the Internet on society (Havick, 2000); the general interrelationship between the Internet and television; and the Internet in the context of digital television, multimedia, and broadband communication (Chan-Olmsted & Kang, 2003; Picard, 2000), online content of mass media organizations (Coyle, 2000; Lin & Jeffres, 2001), regulatory and economic implications of Internet broadcasting (Fan, 2000; Waterman, 2000), and the characteristics of the Internet audience (Webster & Lin, 2002).

Television stations have adopted a variety of internet strategies, from outsourcing Internet operations, utilizing the Web to create interactive advertising experience, employing the Internet as a marketing tool for on-air content or station brands, and positioning Web sites as local portals, to producing content for enhanced television (Kerschbaumer, 2000). A 1999 NAB survey of television stations revealed that the majority of stations (70%) maintained their own Internet operations, while the rest either outsourced their operations to a third party, used a combination of outsourcing and internal management, or had their parent network maintain the Internet function (Nitschke, 1999).

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Internet Business Models for Broadcasters: How Television Stations Perceive and Integrate the Internet
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?