Report: Networks Cling to Easy Money as Net TV Grows

(MoneyWatch)  There's a reason why traditional broadcast and cable networks have been slow to embrace online distribution of their programming: programming fees and ad revenues are still easy money, far easier in the short term than figuring out a workable model for the Web. Toronto-based media analysis firm Convergence Consulting released the newest edition of an ongoing series of reports called "The Battle for the North American Couch Potato," which underscores networks' reluctance to hop off the traditional gravy train:

There is no current economic rationale for Broadcasters & Cable Networks to abandon traditional TV or attempt to accelerate a transition to a total online model. To do so would put $66 billion in traditional TV advertising revenue and $30 billion in cable, satellite, telco TV provider programming fees at risk.

The survey of about 1000 participants found that just 9 percent of TV viewers also watched full episodes of broadcast or cable programming online in 2007, and places this figure at 14 percent for 2008. Granted, some networks still don't put full episodes online -- through content distributors like iTunes or otherwise.

But in spite of the TV industry's reluctance to go digital, online viewership of made-for-TV media is definitely on the up. The recent "Frontline" documentary on the Iraq War has drawn a record 1.5 million views on the PBS website since it went up in late March. And TVNewser's Steve Krakauer learned that MSNBC.com posted a record 125.7 million video streams last month.