• by Wayne Friedman , Staff Writer, December 13, 2006

TV executives might not be the geniuses they think they are.

Now a year and a couple of months after Walt Disney made its groundbreaking announcement that it was selling its TV shows on iTunes, all downloadable sales--including those of digital music--apparently could be declining. This is according to a report by Forrester Research. (For the record, an Apple spokesman says the Forrester analysis is plain wrong.)

TV executives did make at least one smart move: weeks after the Disney-iTunes deal, media conglomerates, including Disney, started making not just iTunes deals for $1.99 a download, but also advertising-supported and free-streaming video deals.

As it turns out--not so surprisingly--media companies have come to believe advertising-supported, free content has a greater growth potential among consumers.

Apple Computer's iTunes still represents a great platform for those viewers seeking advertising-free content. One could only expect that Apple might even make improvements to make the service even easier to use. That means TV networks will continue to get the marketing support they need for consumers to get their anywhere-anytime fix of TV shows.

Perhaps the the gee-whiz gadgetry of the Internet and/or portable entertainment players is wearing off--that is, being able to watch a TV show in an airport or in a restaurant as opposed to having boring conversations with your fellow fliers or diners in those locations.

And, as everyone has snickered about for the last year with all these digital TV portable offerings, there is the question: Why would anyone really want to watch a full TV show on a two-and-a-half-inch screen? That is, unless you had too.

TV shows bring in a small part of iTunes' revenues. If the sales results are accurate, it would also mean music downloads are also suffering- big time. This should give some shudders to record labels executives.

For TV executives there's always been a loose plan of using every possible digital platform--Internet, VOD, mobile, iTunes--to cover their bets, not really knowing which area will dominate. It wasn't as if there was a strategic plan; it was a throw-everything-against-the-wall deal.

Though messy, it's definitely not brain surgery.