TV downloads are more profitable than TV broadcasting

The Hollywood Reporter has a fascinating look at the economics of iTunes video downloads, which give $1.44 per clip to the networks:

Such hit primetime series as “Desperate Housewives,” “CSI: Crime Scene Investigation,” “Survivor” and “Lost” command about $440,000 per 30-second advertising spot, which implies a $26 cost-per-thousand rate. With a typical 17 million viewers and 13 minutes of commercial time per hour, one episode of such a hit series generates about $12 million in gross ad revenue…

By comparison, even in the worst-case scenario — with 20% of TV viewers opting for downloads, 100% of which overlap with existing programs — downloaded episodes of such popular series can generate an estimated $15 million in revenue.

[Via WebProNews]

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