How the channel makes money on tv
The answer, it turns out, is neither simple nor clear-cut, especially in a time of rapid technological change and shifting TV viewing habits.
The economics of television started out fairly simply. Back in Don Draper's day, broadcast networks sent their signal filled with entertaining shows to anyone willing to watch their advertising, which paid most of the bills.
Who makes the most money on YouTube?
If you lived in a place where the signal didn't reach, you could pay a cable company a monthly fee to bring it to you over a wire. Soon "broadcasters" agreed for a fee to send their shows over the cable.
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How do cable companies make their money?
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So now program producers generated two streams of revenue—ads and subscription fees—collected by cable operators who packaged programs in "bundles. Read More DOJ may demand 'substantial' concessions from Comcast-TWC: Analyst Just how much of your monthly payment goes to the program producers is the subject of periodic negotiations between cable companies and program networks.
When those talks break down, both sides take out angry full-page newspaper ads and—occasionally—one side or the other pulls the plug until the network can come to terms.
All went—relatively—smoothly in the television industry until the Internet came along. That meant a whole new group of companies—including phone companies charged a monthly fee for a separate wire to your home—could sell you access to the Web.
It didn't take long for the cable companies to figure out to sell phone service to their TV subscribers.
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- We all know that television channels make money from advertisements.
For the first couple of decades or so, the Internet wasn't technically ready for prime-time video, so until fairly recently there wasn't much to watch. But as the speed and quality of "broadband" improved, video moved online. Now, you can download or stream TV shows and other videos without subscribing to cable television.
You just have to know how to get YouTube to pay you—and the rewards can be significant. In this article, we'll take a look at some of the easiest ways you can make money with YouTube videos and how to get started with YouTube marketing. Remember that Google owns YouTube, and Google is the king of online ads. YouTube will pay you every time someone clicks on one of the advertisements that appear before your video begins or clicks on one of the banner-type advertisements that pop on videos while they're playing.
The rapid rise of Netflix —and now Amazon video, Hulu and other streaming services—has prompted some cable TV subscribers to "cut the cord" and watch all of their TV over the Internet. Most cord cutters are hoping to avoid paying for "bundled" channels they don't watch.
Given the way cable companies and networks carve up your monthly bill, lots of people pay for TV they don't watch. ESPN, for example, reaches only 3 percent of the total cable audience, but gets paid 18 percent of cable subscription fees, according to MoffettNathanson Research. Fox, by contrast, reaches 13 percent of the cable TV audience, but gets only 3 percent of subscription fees.
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But cord cutters don't leave cable TV companies empty-handed. Many of those subscribers are still paying the same company for Internet-access cable TV shows. But cord-cutters don't pay the subscriber fees that get passed along to individual program networks.
With subscribers heading for the exits, some programmers are experimenting with offers to let you "unbundle" the fees they collect —and cut out the cable operator.
This shift to streaming services that bypass cable operators—known in the industry as over-the-top viewing—has been accelerated by brisk sales of devices like Roku that let viewers bundle their own streaming services in one place.
That trend could accelerate if and when Apple unveils its long-awaited entry into the fray.
Others aren't so sure. It remains to be seen whether a la carte program fees would be less than the bundled price cable subscribers currently pay.
Mention it verbally in your videos and add screenshots that show what the store looks like, what viewers can buy, and the website URL. They hold all the money, so make the purchasing decision easy for them by spelling out the benefits. As you encourage viewers to leave YouTube and view your digital store, Watch Time on your channel may decrease. You can always wait until the end of a video to mention your digital store and keep viewers watching. I mean, seriously!
That poses a threat to everyone's business model—from companies like HBO and ESPN that sell premium content that's expensive to produce—to the cable companies and wireline phone companies that serve up Web access to homes. As the audience how the channel makes money on tv more of its shrinking attention to videos on Facebook and YouTube, an entirely new "free" video model is emerging, "where content is being created and distributed entirely outside the existing ecosystem, often at a fraction of the cost of traditional linear TV," said MoffettNathanson analysts in a recent blog post.