Can New TV Be Profitable?

We all know how television content is made. Producers develop concepts, create pilots, and try to land network contracts. The networks distribute the shows, and in some cases, the show episodes will show up on the network website or maybe even a streaming site like Hulu or Netflix. And if the producers come up with a hit show, everyone makes some money.

But how can you possibly make money by producing a show just for Internet distribution? Well, in at least one case, the proof is in the pudding. The Digital Broadcasting Group (DBG) launched an experiment early this year with an A-list star: Kieffer Sutherland in “The Confession.” And the show was broadcast only on Hulu.

According to a report on GigaOM, DBG created the program with borrowed money, and less than six months later, the project is already profitable and it’s not even finished making money yet. The series will soon be available on other Internet sites. And DBG accomplished all this without lining up a major sponsor or other funding source before starting production.

From my perspective, this is yet another important step in the transformation of television entertainment. It’s true that “The Confession” episodes are only about 8 minutes long, but it’s a proof of concept that shows you don’t need to be part of the traditional network/linear content model to be successful. I don’t expect to see a flood of similar projects right away. This does hold out hope that there’s an alternative model that could work to deliver something better than one more reality show or singing contest.