Changing Hulu’s Business Model Could Get CBS Shows Online

As I noted in my post about this on Tuesday, CBS has been the most reluctant of the four major networks to put episodes of its shows online. Unlike ABC, NBC, and Fox, neither CBS nor any of its corporate affiliates owns a stake in Hulu. The network puts relatively few of its shows on the streaming service, and when it does, the video quality is significantly lower than that of their competitors. In some cases, it doesn’t put certain hits online at all: 2 Broke Girls started out with full episodes available on Hulu, then full episodes were available only on CBS’s website, and now the network only makes clip shows available. The episodes aren’t even available on iTunes (though you can pick up a game based on the main characters). If you’re not watching the show on your television screen, you’re not watching it.

But could that change if Hulu, as has been discussed, moves towards a system that would require users to authenticate that they subscribe to a cable service in order to stream shows (whether it would preserve a pay alternative like Hulu Plus is an open question). Les Moonves told the Hollywood Reporter that he’d reassess doing business with Hulu if the company moved to an authentication system.

It makes sense that CBS would be the network most reluctant to experiment with online content. Like all networks, CBS has had some dips in ratings this spring, but unlike NBC, which is almost being forced into niche programming against its will, CBS still has huge mass-market hits like NCIS, Two and a Half Men, 2 Broke Girls, and The Big Bang Theory. CBS isn’t scrambling to meet the needs of a fanatical audience with very precise tastes both in content and how they consume it. That doesn’t mean that the network isn’t thinking about digital—Moonves says they’re working on web-only content to be prepared for the day when that business model is financially viable. But they’re not approaching streaming episodes with a sense that they need to do so to preserve the audience they’re in danger of losing. From their perspective, authentication would give CBS the means to provide a new and improved convenience to the customers they’ve already got locked down. The question is whether they’re acting from a position of strength or poised for a crash if they’re suddenly confronted with a generation of users that wants much more flexibility in their viewing experiences.