Fox Lets Affiliate Station Sites Feed at its Video Trough

Fox is expanding its “Fox on Demand” streaming video and download-to-buy service by allowing its affiliate stations to offer the content via their own Web sites.

Fox Interactive Media (FIM), Fox Broadcasting Company and Twentieth-Century Fox Film Corp. plan to use pre-roll, mid-roll, contextual and search ad placements with the new service, said FIM spokesman Dan Berger in an interview with ClickZ. The deal will involve more than 200 local Fox affiliates and will entail both transactional and advertising-based revenue sharing.

“The new platform will also provide enhanced advertising opportunities through more specific targeting,” according to a FIM statement.

Berger said ads will be sold both by FIM and by the local affiliates., and the deal will involve a typical revenue-sharing arrangement in which the local stations will receive 30 percent of ad proceeds and the parent company will keep 70 percent. Ron Berryman, senior vice president and general manager of Fox Interactive Media Stations Group, said different types of Web advertising will be used.

“Times are changing, and from our perspective the business is being developed across the Internet, and we’re taking a look at all the opportunities,” he said in a prepared statement. “We’re testing distribution models out as everyone else is. It’s not just traditional pre-rolls or display ads. We’re getting into contextual ad delivery and search ad delivery.”

Viewers will be able to buy and download individual episodes (on the day after they air) for $1.99. They’ll also be able to purchase entire seasons of their favorite shows. Full seasons will cost between $19.99 and $39.99.

“Fox on Demand” is an ad-supported, streaming-only platform powered by FIM’s Direct2Drive online store which also sells video games, movies, anime and other digital content. The “Fox on Demand” downloads, first offered in October 2006, have been accessed via Fox’s page on MySpace.com (owned — as is Fox — by Rupert Murdoch’s News Corporation) and on 24 of the network’s owned-and-operated MyFox local Web sites.

According to FIM, Fox.com visitors interested in purchasing programs will be asked to enter their zip codes. Their browsers will then be directed to the “Fox on Demand” portal on their local affiliates’ Web sites.

In his statement, Berryman said FIM is happy to give the affiliates an opportunity “to build meaningful, localized video distribution businesses online and offer their audiences the highest quality viewing experience.” He said the effort to sell programs with “Fox on Demand” on MySpace.com and at the owned-and-operated Fox affiliate Web sites has enjoyed “great traction.”

Joe Denk, chairman of the FOX affiliate board, called the new deal “the next logical step” in the board’s partnership with the network. Denk is vice president and general manager of KFXA-TV in Cedar Rapids, IA.

Matthew Glotzer, Fox Senior Vice President of Digital Media, said the agreement is the “first market-wide, localized, broadband video offering that includes both ad-supported and sell-through business models.”

“Fox on Demand” is currently offering the shows “24,” “Bones,” “Prison Break,” “Standoff,” “Vanished,” “Talkshow With Spike Feresten,” “‘Til Death,” “The Loop,” “War at Home,” “American Dad” and “The Winner.”