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ECommerceTimes.com

Who's Riding the New TV Wave?

By Jeff Kagan
Oct 7, 2016 5:00 AM PT
forecasting

There is a generational shift occurring in the television industry. Traditional cable TV, which dominated the last several decades, is going away. Companies like Comcast, Charter and Cox are facing something new: new technological innovation and competition. Which companies will survive, and which will not?

Traditional cable TV is on the verge of an extinction event that is very similar to other events we've witnessed. Apple's iPhone and Google's Android operating system launched the smartphone wars, for example, killing previous leader BlackBerry and driving it out of the handset business.

BlackBerry once owned the majority of the smartphone market. Today it has less than 1 percent. It's been that way for several years, and BlackBerry just pulled the plug on its handset business last week. Going forward, it will be a software company only.

Out With the Old, In With the New

If cable TV is facing extinction, what is taking its place? There are multiple new technologies that are changing the space rapidly. IPTV -- that is, television over the Internet -- is a hot growth segment. AT&T U-verse, Verizon FiOS and CenturyLink Prism are IPTV services.

Wireless TV, or mobile TV, is another big area of transformation. We are used to watching TV at home or in the office, but watching it over a wireless network on our smartphones or tablets -- anywhere, anytime -- is going to become a rapidly growing segment.

Other new players -- for example, streaming services like Amazon Video, Netflix, Hulu and countless others -- also are transforming their segments, so the entire television industry is going through a generational shift.

Cable TV's biggest growth engine no longer is television -- it's high-speed Internet. Wireless TV is another big growth driver.

Only some television providers are innovating and moving forward -- others are stuck in the past. Comcast has developed its Xfinity IPTV service to compete with AT&T, Verizon and CenturyLink. Comcast does not have a wireless play yet, though -- it tried several years ago and failed. It is going to try again in 2017.

Other cable television competitors, including Charter and Cox, seem to be hanging back.

Satellite TV is another area facing rapid transformation. DirecTV and DISH once were the top two satellite TV providers. AT&T acquired DirecTV and started to transform the idea of television. Now it offers wireless TV as well as traditional satellite and IPTV.

DISH seems stuck with basic satellite television. It recently began offering a "skinny bundle" in an effort to capture market share. DISH is feeling the pinch of new competition, and it is reacting. If it's latest approach is successful, however, it will be popular only with the slice of the market that's not interested in innovation.

Different Paths

I see the television industry at a fork in the road. Taking one path are the companies and new technologies that are transforming traditional cable TV. Taking the other are the traditional television companies that want to slow the wave of change and hang onto the way things were.

Some companies will grow over the next decade, while others will shrink and even die. There is no stopping this wave of transformation. Companies either ride the wave or it goes on without them. There is no other choice, as BlackBerry painfully discovered.


E-Commerce Times columnist Jeff Kagan is a wireless analyst, telecom analyst, industry analyst, consultant and speaker who has been sharing his colorful perspectives on the changing industry for 25 years. Email him at jeff@jeffKAGAN.com.


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