Viewers moving onto the Web, money streaming along.

TVs are becoming superfluous when one is craving a television fix. Networks across the globe are bringing their TV programs to the Web. Fragmented audiences and commercial-skipping technology (i.e. PVRs) are making streaming video imperative to advertisers, and broadband technology is making it possible.

Greg Smith, evp of Media Insights Planning and Analysis at interactive media services company Carat Interactive said, "When TV networks say online programming and advertising are nice complements to their on-air presence, what they're really saying is, [Audiences are leaving, we better figure things out.' Ultimately they have to learn to program for a non-linear world." And that is exactly what they're doing, in the form of original shows for the Web, whole episode rebroadcasts online and TV episode companion pieces available on the Internet.

Major media conglomerates have dedicated themselves to entering the Internet sphere. Viacom has multiple broadband channels available to complement its on-air channels, with more plans underway. Rupert Murdoch's News Corp. plans to invest $2 billion into Internet companies in the next few years. Branded Internet companies, like Yahoo! and AOL, are beginning to get involved in video streaming (AOL attracted five million viewers in August by offering the Live 8 concert online). Search engines Google and Yahoo!, familiar faces at TV trade shows, are even vamping up their video search properties. Microsoft's proposed plans to take over AOL could make things even more interesting, as NBC Universal is associated with Microsoft and Time Warner is in the same media family as AOL.

In the U.S. alone, more than half of homes with Internet access use high-speed broadband services; in Canada and several European territories that number is even higher. As a result, online interactive television is becoming more user-friendly. TV programmers, Internet companies and advertisers across the globe are realizing that they are living in a TV and broadband world, and the two have to work together.

In 1999, U.S. lingerie retailer Victoria's Secret pioneered the idea of streaming video by showing their fashion show on the Internet, but despite the scantily-clad women, the show failed to catch on because of zero percent broadband penetration in the U.S.

Today, things are completely different. Roma Khanna, svp of content at Canada's CHUM Limited, explained that Canada is the second most connected country in the world when it comes to broadband. "We have the luxury of an audience that's really picked up on this," she said. Khanna mentioned that original content from CHUM's music channel, MuchMusic, as well as its news channel, N24, is available via the Internet (via both broadband and narrowband connections, with more interesting options available for broadband users).

"The audiences for those two networks are very different," Khanna said. "N24 viewers are news junkies who want to get up to the minute news; MuchMusic fans are die-hard (mostly young) fans who want to watch new content and learn everything they can about the bands they like." The latter group, a younger demographic, is the driving force behind so many nets moving to the Internet. It is a demo that relies on the Internet, and one that is hot in the eyes of advertisers. "TV viewership is really only significantly eroding for the younger demos and this is a great way to get them back," said Brad Adgate of media services company Horizon Media.

Much has been made of the declining attention span of young viewers, and because Web-based television tends to be short-form content, it is popular with younger demos. Jason Hirschhorn, svp, Digital Music and Media, MTV Networks, said: "[Broadband programming is] great for us because short-form content is our core business." MTV Networks has jumped head-first into the broadband marketplace, offering numerous broadband channels for its users (including Nickelodeon's TurboNick, VH-1's VSpot and MTV's MTV Overdrive; a Comedy Central broadband site is in the works). Hirschhorn said, "We are looking to Overdrive as a new sphere. Because most of the programming is VoD-based and our video production is some of the best in the world, it's an easy transition." Among its many features, MTV Overdrive allows viewers to watch selected clips of their favorite shows and to watch After Shows, which complement TV programming. "We are really putting the emphasis on the MY in [MTV slogan] "I want my MTV!"

Scripps Networks is also showing commitment to the younger demo, with a new original broadband show based on its younger-skewing Food Network show, Good Deal with Dave Lieberman (which features a 20-something host). The broadband series will offer new content, exclusively for the Internet. "We hope it brings younger audiences to the TV show," said Jeff Meyer, svp, Interactive Sales at Scripps Networks. The company already runs a broadband site called HGTV Pro, geared toward professional building contractors. Scripps Networks' president, John Lansing, has announced plans to launch several vertical broadband channels in the near future. The streaming video sites will help users with specific projects, like remodeling a kitchen or adding a deck to a backyard. Meyer expects this kind of online niche programming to be the future. The Internet's compatibility with niche programming explains why, in the U.S., the cable companies are a bit ahead of the broadcast nets, which have to cater to broader audiences.

Besides the young demo, another group that jives well with Internet programming are die-hard fans, who can't get enough of their favorite shows. MTV's Hirschhorn attributed MTV Overdrive's success to the fact that "fans are completely devoted to their shows."

And if anyone's going to benefit from the cult audience, it's the Sci Fi network. The net streamed the entire season premiere and finale of Battlestar Galactica early last year. "We wanted it to be available to watch over and over," said Craig Engler, general manager of Sciri.com and Sci-Fi magazine. Interestingly, it was online piracy that caused the company's executives to sit up and take notice of the Web's possibilities. "We became aware of online piracy of the first episode before it aired, and realized we could gain a huge interest from the online community," he said. Besides showing extras (which Engler explains are economically sound to make, as they can also be used for DVDs and mobile applications), the company also does Podcasts (available via iPods and other MP3 players), which offer audio commentaries that run alongside the show, in an effort to drive repeat viewers. In the future, the company plans to make original "webisodes" for the net. "We could see taking a show [that features] five characters, and adding a sixth character whose storyline is available exclusively on the Web," Engler said.

"We look at the Internet as a way of offering viewers an enhanced version of the channel. People are looking for information on their favorite shows," said Bravo's svp of Marketing, Jason Klarman. His company began branching out into the Internet during the fourth quarter of 2004. Most recently, original online programming included a sixth family not featured on the television version of Sport Kids Moms & Dads. A recent Internet initiative involved a partnership with Major League Baseball. The first episode of the most recent season of Queer Eye for the Straight Guy, where the "Fab Five" made over the Boston Red Sox players, was available in its entirety on the Major League Baseball website. "Needless to say, those are not our usual viewers, so we were able to attract a whole new audience!" said Klarman.

Attracting a new audience is a major advantage to putting TV programming online. "It's a loop," said CHUM's Roma Khanna, "some viewers originate from the Internet, and some come from TV to the Internet; they are really coming back and forth."

While it would be nice to think that broadcasters are bringing programming to the Web just to satisfy viewers' desire for more programming, in this business, if they don't have significant advertiser support, new innovations are a no-go. Broadband revenue today stands at 200 million, which, according to Horizon's Brad Adgate, "is a drop in the bucket compared to the billions of dollars that TV advertising generates, but we should see more of a dollar commitment," he predicted. "We're moving away from a subscriber-based revenue for the Internet, to an ad-supported revenue."

Mark Boyd, director of Content at U.K. advertising agency BBH, concurred. "It's a maturing marketplace. In the U.K. we are seeing increasingly significant budgets being reserved for the Internet. The convergence between TV and the Internet is new, but ... advertisers will follow audiences wherever they go." He added, "When it comes to entertainment, we are fairly sure consumers will want more, though they are not going to want to pay more for it. They'll look to advertisers to subsidize content," he said. "We need to start asking how we can get advertisers into broadband."

Boyd pointed to the opportunities that online promotions offer advertisers. One of those is interactivity: "The great frustration with TV is that it's a one-way conversation, but with online advertising, viewers are able to respond, to click on links and move to the next step." He added that the niche factor of websites allows advertisers to target their audiences better, something that Carat Interactive's Greg Smith emphasized. "The general rule of thumb in advertising is that you don't have to reach everyone, you only have to reach people who are interested in your product; and that's something Web advertising does." He added, "advertisers would be willing to pay five times as much CPM for the right audience. Put it this way," he said, "If you are paying $10 CPM for television but you're only getting one tenth of your desired demo, then it's actually like paying a $100 CPM. So, if it's more targeted, then a $50 CPM for the Web is actually a better deal."

He continued, "Commercial minutes per hour are down; commercial viewership is down because of PVRs. Those who are still watching TV are watching commercials less and less."

Internet advertising also allows for more innovation. "I don't have to run a traditional '30 [second spot]' on the Internet, I can run a '15.' I can really go beyond the 30-second spot. There's also less clutter and I can generate more attention, and do more to close the deal." Smith added, "It's also not too expensive to make, because it's all done digitally."

"This is a revolution we're seeing," Smith said. "The media is going to become more digital and more measurable." That measurability is a major advantage to advertising on the Web. "Unlike Nielsen, which can be inaccurate, the tracking service on the Web is absolutely accurate," said CHUM's Khanna, "so advertisers can know exactly how many people are viewing their ads."

Horizon Media's Adgate pointed out that broadband usage is at its highest between 10 a.m. and 3 p.m. (the middle of the workday), which is the opposite of TV viewership. This means that advertisers are being given an extended window in which to reach consumers.

When it comes to types of advertising, banners and streaming 15-second clips are most common. There are "four ways to advertise on MTV's broadband sites," according to Hirschhorn, "First, there are banner ads, then there are 15-second promos with a banner ad (and the nice thing for advertisers is they can't be skipped), then there are opportunities to sponsor an area or a page, and then there's the old-fashioned 'brought to you by ...' kind of advertising too," he said.

Broadcasters sell advertising in two ways: as part of a package along with television ad space, and as a stand-alone Internet package. Most of the nets said their advertisers were split half and half--some advertised as part of larger packages grouped with TV ad time and some were new advertisers unique to the companies' websites. "We sell convergently," said MTV's Hirschhorn, "most of the advertisers who spend real money [online] are the blue chip advertisers who spend a lot on-air too." Scripps Networks is one company, which, by gearing its broadband sites to more niche audiences, attracts a whole new set of advertisers: those with narrow target audiences and less disposable ad budgets than those which advertise on-air.

One company, which need not worry how advertising fits into its broadband programming is U.K. public broadcaster, the BBC, which is rolling out two major Internet initiatives. Emma Somerville, the BBC's head of Interactive Programming said, "The reason we get a [public] license is to be innovative. We can afford to take chances (whereas a private broadcaster can't as much). It seems quite right that we should be trailblazing [when it comes to Internet programming]." The BBC is showing that it takes cross-platform delivery very seriously with two plans in the works. First, is the Internet media player, known as MyBBC Player, which just finished its technical trial and is now in the content trial stage.

The technology makes all BBC output available on the Web. "It has huge implications. We want to see how the audience uses it," Somerville said. The other initiative is TV Plus, a project that has the company planning Internet tie-ins from the very inception of its new shows. Among programs in the works, the BBC is commissioning a BBC3 comedy that will take advantage of Internet opportunities from the show's inception.

When asked whether she thought TV programming on the Internet could drive viewers away from the television, Somerville was adamant. "Not at all. We need to start measuring success by more than just overnight linear numbers. It's really about developing our brand." None of the network executives admitted to feeling that the Web could hurt TV viewership. "The lean-back experience of TV is very different than the lean-forward Internet." said Scripps Interactive's Meyer.

"There have been no indicators of a fall in television ratings as a result of the Internet," said MTV's Hirschhorn. "In fact, our channels' ratings are now higher than ever. This is not about cannibalization, it's about creating an eco-system of screens."