• by Joe Mandese  @mp_joemandese, June 29, 2007

Tensions between the old world (ie. television) and the new world of video were apparent Thursday during a series of keynotes and panel discussions at the OMMA Video conference in New York. The biggest tension appeared to be the conflict between the traditional television provider's reluctance to give up control and the desire for online video portals to provide users with unfettered access to their video programming.

Asked by conference chair and Video Insider columnist Steve Smith to sum up the single biggest issue confronting the convergence of television and online video, Yahoo's Karin Gilford and AOL's Scott Levine concurred that it was getting traditional TV networks to "remove the restrictions" associated with playing their shows online.

Asked what the biggest problem was for the online portals, Disney-ABC's Rick Mandler quipped, "Asking us to remove the restrictions."

On a serious note, Fox's Ron Berryman said the lifting of such restrictions raises serious business questions. For example, "Who controls the advertising in it.

"There are a number of questions that come up depending on which player it is played on," he said, noting that indigenous online video players don't seem to be making a very good go at it yet.

Berryman noted that the free-spirited nature of indigenous online video services has yet to prove economically successful from an advertising point of view, and implied that was a big factor in the reluctance of major networks and studios in giving up control.

"It's very difficult to monetize. I would say that both YouTube and MySpace in their areas are very difficult to monetize," he said.

Disney-ABC's Mandler said the networks are wrestling with other economic issues related to their burgeoning online video businesses, and that they are challenging traditional economic models. He cited two specifically.

The first one concerns bandwidth, he said, noting, "Unlike traditional broadcasting, the more people that watch your programming, the higher the costs. That's an interesting dilemma. There's all sorts of solutions for attacking that problem, but it won't go away."

While Mandler did not elaborate on ABC's solution, it presumably has something to do with how Disney-ABC prices its online video streams to advertisers.

The other technological issue concerns how video on the "public Internet" gets viewed on the large TV screens in the typical living room.

"There needs to be a technological solution for that gap for the industry to grow rapidly," Mandler said.

The traditional TV executives implied their online video operations were profitable, but they demurred when asked to characterize exactly how, and how much money they were making from online video.

Disney-ABC's Mandler described "success" in terms of volume, noting that since ABC.com began streaming its TV shows online more than a year ago, it has generated more than 107 million "episode starts." But he declined to say how much revenue was associated with those showings, stating only that, "Yes, we have a very profitable business in online video going on."