Behind C-SPAN’s pay-TV strategy

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C-Span. (C-Span)
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Alex Weprin

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C-SPAN said Monday that it would soon require visitors to its website to “authenticate” that they are pay-TV subscribers in order to watch livestreams of its three TV channels online.

In effect, if you don’t pay for TV service, you soon will not be able to watch the channel feed on C-SPAN.org.

Only the live feed of the three channels are affected. Other livestreams, like those from Congress and the White House, will remain free, and every C-SPAN program will have its video placed in the channel’s vast video archive, all of which will also remain free.

The reason behind the change is fairly straightforward: C-SPAN’s revenue is dependent on pay-TV subscription fees.

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C-SPAN, while it provides a public service, is not run by the U.S. government. It was created in 1979 by the cable TV industry, and to this day remains funded exclusively by pay-TV providers, who give the non-profit network monthly carriage fees, as many commercial networks get.

“All of C-SPAN’s revenue comes from cable and satellite companies that provide our TV channels to their customers,” C-SPAN co-C.E.O. Susan Swain said in a video announcing the change. “Reserving online access to our three television channels to cable and satellite customers reflects the dynamic changes you are seeing in video distribution today.”

Those dynamic changes include the rise of the internet-enabled TV set, a source of great potential, but also a possible source of pressure on revenues eventually.

“Think about Apple TV, think about Chromecast, we see projections that say that by 2017, something like 75-85 percent of all televisions will be connected to the Internet,” Peter Kiley, V.P. of affiliate relations for C-SPAN, told Capital. “When you are going to have a huge number of people able to do an end-around of the way that we fund our television channels, we thought to extend and continue and succeed with that business model—that has been very successful for us—we needed to make some changes. That is why we came up with this sort of hybrid approach.”

In other words: as the pay-TV business faces rapid change spurred on by new technology, the threat of disruption to the traditional pay-TV bundle affects not only commercial channels like ESPN, but channels like C-SPAN as well. C-SPAN may be a public service, but it is funded by cable and satellite TV providers. Those monthly carriage fees also allow C-SPAN to remain non-commercial and advertising-free, making it an anomaly among basic cable channels.

The network clearly recognizes the unique service it provides, hence the continued livestreams of Congress and the government, and the fact that every video will remain free in an on-demand fashion. But from here on out, if you want the traditional, more edited and curated TV viewing experience online, it will require a pay-TV subscription.