Where Oscars flopped: Bid to live stream the show online broke down

ABC promised online viewers a live stream of the Oscars telecast Sunday, but a 'traffic overload' crashed the Internet broadcast for most of the show, generating some angry Tweets.

The Oscars championed winners in all aspects of the film industry, however when it came to streaming the event online in real time, the gala celebration turned into a loser.

ABC promised online viewers a live stream of the network telecast Sunday, an experimental choice that was perceived as moving networks and cable and satellite operators closer together as viewers’ media platforms of choice continue to evolve from television sets to online media, such as tablets and smartphones, and Internet-enabled televisions.

There was precedent last month that suggested the Oscars decision would be a success: Super Bowl XLVIII became the most-viewed live-streamed sporting event in US history, attracting an average audience of 528,000 viewers per minute, a 52 percent increase from the 2012 Super Bowl, which was the first year the game streamed online.

Fox Sports reported that viewers spent more time online watching the game than in previous years: users spent an average of 48 minutes watching the game via the Internet, an increase from 38 minutes in 2013, and 37 minutes in 2012.

Oscars viewers didn’t get that far. The live video stream shut down for the majority of the broadcast across the US “due to a traffic overload greater than expected,” an ABC rep told Variety Monday. The outage sent viewers to Twitter, where the network was flamed all night.

Getting real-time viewing online is becoming more of a priority for traditional broadcast networks. Not only can the networks secure more viewers and, therefore, more advertising dollars, but they also earn revenue, known as retransmission fees, from cable and satellite operators for the rights to stream their programming.

In November, the global research firm SNL Kagan estimated that network broadcasters will collectively earn more than $3 billion in such fees in 2014, a figure predicted to grow to more than $7 billion by 2019.

For the Oscars, ABC partnered with eight cable operators, the largest being Comcast, in eight markets: New York, Los Angeles, Chicago, Philadelphia, San Francisco, Houston, Raleigh-Durham, N.C., and Fresno, Ca.

Cut out of access were three of the nation’s four largest cable and satellite giants: Time Warner Cable, DirecTV and Dish Network, presumably because they have not yet signed new distribution deals with the broadcaster.

The online-versus-traditional viewing model still skews heavily for television watchers. The Associated Press reported that only 17 percent of US viewers watched the 2014 Olympics online, compared with 86 percent who watched on their televisions.

But digital viewing is expected to grow in coming years. The research firm eMarketer, based in New York City, forecasts an 11 percent increase in digital television viewers over the next three years, peaking at 145 million in 2017. In fact, we have already reached the tipping point: More than 50 percent of the US Internet user population has viewed streaming television.