• Financial Times, Monday, September 24, 2007 11:15 AM

Television executives are convinced that the bigger opportunity for their industry is not digital downloads but streaming their programs over the Internet with advertising. The networks began to experiment with streaming video last year. An ABC survey in August 2006 found that 84% of viewers believed they were getting "a great deal" by being allowed to stream programs for free, even if it meant advertisements could not be skipped. The network also found that 87% of respondents were able to recall which advertisers had sponsored particular episodes.

Other studies indicate that giving people more outlets on which to watch television is increasing consumption. This season, streaming is moving beyond testing to widespread adoption. A key change for the networks is that the programs will be available to consumers not only on their own Web sites but through a variety of partners. Several industry observers saw Disney's agreement last week with AOL to show program such as "Desperate Housewives" as a watershed moment.

In spite of the industry's optimism, there are still plenty of concerns about streaming. A major one is its possible impact on the $4bn syndication business, where television studios have traditionally cashed in on hit programs by selling them as re-runs. Streaming video to large numbers of consumers is also taxing on Internet infrastructure and costly. There also are likely to be more tensions between the media companies that create content and the technology partners like Apple that distribute it.

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