FOLLOW THE MONEY$$$
This wisdom is universally applied, from financiers to criminal investigators. The video content space is no exception. If you make content or distribute it, look out because the money is moving!
Broadband (AKA Internet TV) has taken cable for the title. Broadband is now the top revenue driver. The cash cow for all the major players. What does this mean for you and me? Well, competing in the streaming market will become more challenging. Entering the market now has benefits that will never come again. In other words…
The time is now!
Unlike anytime before, those channels that capitalize on Internet TV platforms like Roku & Fire TV are leading. We watched the fall come. Last July, we saw Variety put the writing on the wall in permanent marker. The sum of that article? The next five years spell a complete polar shift.
Mark Zuckerberg knew how important it was to get to the marketplace first, do you?
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We have finally seen broadband beat out cable, if not completely, basically, at least. A few conglomerates remain fighting the cable fight (I’m looking at you Comcast). And it makes sense. Some money is still in the cable market. But the cold hard truth of it all is that the value of cable will consistently transition into Internet TV and their streaming platforms.
Look at the chart here from Variety:
Compare that with the Nasdaq report on heavy cord-cutting. We see an estimated 31.2 million households cut the cable last year. This puts the total U.S. cable customers well below the user base on either Roku or Fire TV. The latter two are leading Internet television platforms. Mind you, Apple TV and Android TV are not far behind.
Of course, we have known viewership was already greater with these streaming platforms.
But more viewers do not immediately equal more money. Many streaming services are priced considerably lower than cable. A part of the price difference is “justified” by the sheer quantity of channels cable provides. A justification that does not hold up. We have learned quantity does not equal quality.
Here is a quote from former DirectTV/AT&T Audience Network programming chief Chris Long:
“At some point, people will make the decision that I can get everything I want [in streaming]. I no longer need to have 180 channels that I only watch 12 of.”
That ‘point’ Chris Long speaks of is being reached. What was a prophetic vision is quickly being written in history books today. According to a new Pew Research Center survey of U.S. adults, cable/satellite viewership has dropped 30% since 2015. That is, in 2015, 76% of adult Americans watched cable or satellite television. Now it is barely over half of that population at 56%. It is not going to get better for cable.
This is the endgame for cable and satellite. The thing is, it’s not leaving a vacuum, like some industries. The cable lifeblood is being sucked out of them by broadband streaming services like Roku and Fire TV. And do not get me wrong, this is great for us consumers. For too long has the monopolies reigned.
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So why is this so important now?
The difference now is that the majority of the cash flow is now on the streaming side. Remember, follow the money. Giants are not easily displaced. The conglomerates are actively taking up positions on the very streaming platforms that have wounded them. Forbes has an article that lays out their resilience amidst this polar shift.
A quick look at history:
We can see many examples given in past technology. Radio was open source before the networks moved in. Television quickly became monopolized following its invention. Cable had scaffolding in place to only allow for an insider buddy system. Even the freest technology we have recently known, the Internet, has been a target by giant corporations. Those who move now will be the only ones to have this early advantage. And what an incredible advantage it is. We will not see it again.
This is incredible news for independent channels. The playing field has been leveled, as much as can be, for our benefit. Many independent channels are positioning themselves now. By doing so, their visibility will be much stronger at the end of this shift. An excellent example is Pewdiepie. Say what you will about his current events. My point will still stand. He was one of the first to capture a specific niche on the YouTube platform. Which niche? Videos of him playing video games. Crazy right. It is so ingrained in culture now that we almost forget someone had to start it.
This is part of the beauty of an open platform like Roku or Fire TV.
Granted, even the big guys can enter the playing field. And are, but if your there first, it will not matter. Do you know how many people are making videos of them playing video games? You can not count them. Did some people enter after and make it worth their while? Yes, but few have been able to compete with whoever got there first.
Now is the time to get started…if you have not already.
This beautiful period in video content creator history is similar to a flower. We are blooming. Right now. Don’t wait. One day(hopefully years upon years later) this too will fade.