CBS: Unlikely Guerrilla on The Internet

Could CBS Chief Executive Leslie Moonves be turning into a digital revolutionary?

Long an advocate of broadcast television, Moonves would appear to be squarely in the old-media camp. Even so, in recent years he has shown a greater willingness than most of his peers to experiment with digital delivery. CBS has put its programming out on the Web through hundreds of outlets, including Netflix and Web-enabled TV devices. Moonves said last week that CBS is willing to cut the price of shows it sells on Apple's iTunes to 99 cents. Of course, it is easier for CBS to take risks because it doesn't own a big portfolio of cable channels that generate fees from cable and satellite operators. But that is the point. Its lack of big cable channels is arguably now more a strength than a weakness, freeing CBS to try new things. Moreover, because CBS relies for most of its revenue on advertising and sales of its programs to other outlets, it has little choice but to focus on top-rated programming. Other companies, in contrast, generate fee revenue from low-rated channels because they are bundled with bigger ones.