Ooyala and ABC Test Online Payment System

Will viewers pay for TV shows streamed through Web sites? Until now, programs downloaded from online stores like the iTunes Store have had a price tag, while content streamed from channel websites has been ad-supported or free. Using a micropayment system recently introduced by Ooyala, the ABC Family Channel is now offering $.99 streams of the show “10 Things I Hate About You.”

Ooyala introduced the payment system in early March, letting media companies collect money for programming directly, so they didn’t have to rely on ads. The system’s chief limitation is that payments need to go through PayPal, Amazon Payments, or Google Checkout, so media companies can’t use their own established payment methods.

An Ooyala press representative said that a handful of customers with public-facing Web sites were currently testing the service, but couldn’t give more details. That means the ABC Family Channel isn’t the only one using micropayments for streamed content, but it’s the only one that’s been noticed. The rep also said Ooyala would announce the other customers and the test results later this quarter.

The $.99 price will likely seem reasonable to many viewers, and many will like the convenience of being able to stream shows rather than going with a download option. Still, the industry will be watching closely to see if viewership drops and, if so, by how much. The concern is that viewers, especially younger viewers who are this show’s main audience, will choose illegal downloads over any kind of payment.


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