Time Warner and Comcast's TV Everywhere Smartly Creates Perception of Free

(MoneyWatch)  You may have heard that TV Everywhere, the initiative which intends to protect cable's subscription model, even as people become more accustomed to watching full-length video on their PCs, is now out, if not exactly everywhere. The first two cable operators to sign on -- Time Warner and Comcast -- make up only one-third of the nation's cable footprint.

How does TV Everywhere protect cable's paid subs? By only letting subscribers to cable access cable programming online. The initial trial of the concept will be in 5,000 homes, per Mediapost. Starting next month, those homes will get some TNT and TBS programming via sites including Comcast.net. Conversely, people who don't have access will be asked -- nay, required -- to pay for the cable programming they consume online.

Here's the weird -- and potentially smart -- thing about TV Everywhere: It is based on the psychological premise that consumers can now get cable programming online for free, as long as they're subscribers. In a world where no one thinks they should be paying for content, that's the way to play it. It seems to turn watching cable shows online into a value-add. Of course, the hole in that argument is gapingly wide, even though I bet it will be overlooked by most consumers; they are currently getting many series for free online, with no strings attached via Hulu, whose programming is primarily from the broadcast nets.

However, since TV Everywhere is pursuing a "you're getting it for free even though it's not" philosophy, its "mirror" business model -- of having non-cable subscribers pay -- will fall completely flat. Not that those involved in TV Everywhere should really care -- it was necessary to create a pay-per-episode model for non-subscribers just to perpetuate the notion that cable subscribers are getting cable programming online for free.

Previous coverage of TV Everywhere at BNET Media:

• TBS Prepares for Cable TV's Day of Digital Reckoning
• Jeff Bewkes Thinks He Knows How to Keep the Paid Model Alive