Wasting Money on a Wasted Opportunity
In a somewhat confusing move, Cablevision (the TV arm of General Electrics) just purchased the Sundance Channel for 496 million dollars. The thing that seems odd about this is that the Sundance Channel doesn't really offer much of anything. It's not like Sundance has been a great brand name in the mass market (a lot of their prize winning films tank at the box office) and the channel itself hasn't really done much. At first I thought the channel could be a great way to help indie films get distribution. If a film went to Sundance and didn't get picked up by a studio, the Sundance Channel could offer to give the film a short run so that at least someone outside of Park City would get to see the film. That never materialized and the channel became little more than an artsy HBO.
That being said, how much is an artsy HBO, or even HBO itself, going to be worth in the near future. With sites like Hulu offering films on demand and sites like Netflix allowing people to download films immediately, will movie channels be all that viable in the near future? Isn't HBO's future more dependent on their original programming to draw in subscribers? Is The Sundance Channel suddenly going to tap into that sort of market? Some reports had GE looking to turn the channel into an ad driven entity but most of the new original programming is about saving the Earth so I'm not sure what kind of advertising they'll attract. I just can't see "The Green House Effect" brought to you by Mitsubishi and Burger King. At best, I could see Sundance becoming a For Profit PBS but, again, what's the profit in that?
In the end, the only real reason that this purchase makes any sense is so that GE could own the main competition to their current indie channel IFC. That being said, wouldn't it have made more sense just to let the Sundance channel fold as opposed to spending almost 500 million on it? And what exactly is the downside of having a little competition? It's not like either channel is really amounting to much anyway.
Maybe it's my business naivite showing here but it would seem like spending $500 million to improve IFC would make more sense than buying Sundance. That's just me.
