Will The Tech Giants Make Us Cut The Cord On Pay TV?

I have talked a lot about how content and innovation is the key to winning subscribers. I have also talked about how pay-subscription TV services such as Sky will come under increasing pressure as over-the-top streaming services become better and better.

Whilst your customer service is good and your content both unique and in-demand, companies can occupy a relatively protected position. I remain a loyal Sky fan as the service is great and I have access to content (Sports/Box-sets) that I cannot get elsewhere. Simple equation. BT Sports muscled in on this position, and, surprise-surprise, I now pay for that too.

But content is expensive, and bills have risen for subscribers year-on-year. It is inevitable that they will start to look at what other options – as they become available. And there lies the opportunity. Companies that deliver content via the web need to get access to the best content. If they can make this investment work, then their lower costs to deliver must enable them to offer lower prices to consumers. I anticipate increasing activity in acquisitions as those than can invest, will.

Nothing has been announced, and it may never happen, but if we wanted to scan the market for potential deals, there are two companies that I think could make a big move in this direction: Apple and Amazon. Content providers, such as HBO, are an obvious target. HBO produces brilliant content: I have been hooked on Game of Thrones, True Detective, Boardwalk Empire, The Sopranos….the list is endless. And all are available on Sky currently. Whilst I like other services such as Netflix, I am not tempted to move across to this service as I will not get anything ‘more’ than I get with Sky – in fact I will get less as there is no premium sport content available.

If Apple TV or Amazon TV were to make this kind of investment, I think many subscribers would take note, and begin to seriously consider their existing pay-TV service vs the lower cost of moving to an OTT net-streaming provider. Both Apple and Amazon have the brand, and purchasing power to be able to make such a move. Whether they will, only time will tell. If they ever moved into sports-rights acquisition in the UK, well that would really set the cat amongst the pigeons for me personally…..

There is a clear opportunity for companies like Apple or Amazon to drive subscribers towards ‘cord-cutting’ and replacing traditional cable with streaming services, but they will need to make some big statements with respect to content to be able to turn a trickle of defectors into a stampede.

Let’s watch this space…

HBO Voyeur - EEUU//embedr.flickr.com/assets/client-code.js
Photo by Arturo de Albonoz licensed under Creative Commons.

This entry was posted in Current Affairs, Customer Service, Innovation, Telecoms and tagged , , , , , , , , , , , , . Bookmark the permalink.

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