ABC.com draws 3m, takes on iTunes?

Ad-supported television content seems to have a future. ABC today reported that over 3 million viewers haved watched its television shows since it launched the television service just two weeks ago. Reuters reports the numbers provide early sign of demand for television content on the Web and challenge the "ad-free", but paid content available via Apple's iTunes. The Walt Disney Co. is looking into a variety of different business models and may also charge for its own programming, which may bring it into direct competition with Apple. Already the company has begun luring viewers, or potential iTunes customers, and while the details of its iTunes contract is uknown, the ad-supported model may continue to draw large audience, and indirectly hurt Apple's iTunes.

The report says that ABC began a two-month Internet trial earlier this month by allowing viewers to watch four of its programs, including blockbuster hits 'Desperate Housewives' and 'Lost,' on the Web with commercials.

In addition, Disney is hoping to find new ways of reaching users, as it explores diffrent options for expanding the service; currently, the website offers shows about 12 hours after they are first broadcast on television. The content includes a introductory 10-second sponsorship message from a single advertiser as well as three commercials; the report says that users are required either to view or click the embedded video ad spot to reach the next segment.

Interestingly, signaling the importance online video will play in drawing visitors to its ad-supported Web sites, AOL has purchased a small company that specializes in inserting advertising into video and audio clips.

Filed under: industry