The business model is unraveling at ABC, CBS, NBC and Fox and the local stations that carry the networks’ programming. Cable TV and the Web have fractured the audience for free TV and siphoned its ad dollars. The recession has squeezed advertising further, forcing broadcasters to accelerate their push for new revenue to pay for programming.

That will play out in living rooms across the country. The changes could mean higher cable or satellite TV bills, as the networks and local stations squeeze more fees from pay-TV providers such as Comcast and DirecTV for the right to show broadcast TV channels in their lineups. The networks might even ditch free broadcast signals in the next few years.

With the upcoming Vancouver Olympics, NBC is trying something a little different (Media Daily News):

The system, tabbed “Olympics Online Connect,” allows people to prove via an authentication process that they pay a provider for TV service. That measure opens the gate to more than 1,000 hours of live Olympic streaming and full-event replays.

“TV Everywhere” is a concept designed to prevent customers from dropping their pay TV service if the same content is available online gratis.

This is exactly the kind of mindset — in effect, keeping people from accessing the content they want by making it too expensive in a bundle — that ivi seeks to make obsolete.

Artificially impeding the ability to share digital content makes as much sense as attempting to keep people from reading used books. Content owners should quit trying to keep people from distributing content at their own cost. Ask any content owner: They would love to have free distribution. Provided, of course, that they can monetize their content.

Copyright owners have been improperly taken down a rabbit hole by technology companies promising to protect their content the wrong way. DRM restricts the user experience which, in turn, drives users to seek pirated or illegally distributed DRM-free content.

Once we agree that DRM is not a viable solution, we’re free to look at the problem through a different lens.

First, let’s state the goal. Content owners want to control the use of their content. Usually, this means they want to be paid for it.

Second, lets discuss how we achieve it. How do we allow people to easily view and distribute content, while ensuring that content owners can control and monetize the use of that content?

Enter ivi’s Streaming Block Encryption, the right way to protect copyright.

Here is the approach:

1) Allow peer sharing

a) Shift distribution cost to consumer
b) Encourage word-of-mouth promotion

2) Support individual subscription, ppv, and rental models

a) Assign an individualized, trackable identification to each player
b) Track content and time based access for each player

3) Make it easy for the consumer

a) Users are able to say the following: “I’ve paid for it, I can view it.”
b) And “I can share it with others, as long as they’ve paid for it.”

ivi’s proprietary protection system encodes and encrypts content into the .ivi format. This format is only viewable on ivi TV, a live TV player application that runs on Windows, Mac, and Linux. Every ivi TV player is uniquely identified and is programmed to securely pull rapidly rotating decoding keys from the ivi trackers over SSL, then decrypt and decode the content to each individual viewer’s screen.

The .ivi format is encrypted data, viewable only in the ivi TV player, so it can be shared, duplicated, and distributed. However, the shared .ivi files are only viewable on ivi TV. Therefore, the ivi TV player will only allow the shared content to be viewed if it is designated as “free” or if the subsequent viewer has paid for access to that particular shared content.

This “downloadable conditional access system” component to the ivi system has elicited the following response from Stephen Dukes, former VP of Technology from TCI Cable: “ivi solved what the cable industry has spent millions of dollars trying to solve.”

Every content owner that uses the ivi system to distribute their channel, content, or programs, gets all this content protection built in. Best of all, the ivi system allows content owners to control and thereby monetize the use of their content online.

ivi is Internet TV done right.

TV content has every business reason to move online.

For example:

Boomers would be willing to give up their subscription TV service if they could get the same programming online.

By a five-to-one margin Boomers are watching less traditional TV than they did a year ago. Among this group, 62% say it’s because they’re not as interested in what’s on TV these days, and another 26% say they’re spending more time surfing the web.

…

Among traditional TV viewers, 20% of survey respondents say they would be likely to downgrade or cancel their current TV service package in the next six months. The likelihood of canceling is highest among cable (22%) and satellite subscribers (22%), and lowest among fiber-optic TV subscribers (7%).

When asked which one paid subscription – among all media choices – they’d be most willing to give up, 44% selected TV service, which fared significantly worse than any other subscription service.