Can Cable and Satellite TV compete with Online Media?

I must say that I an completely bored with Cable TV options since it seems that the same channels are shown over in local, national and HD.  So out of the promised 250 channels it feels like there are 70 that are repeated over along with 50 or more music channels and outdated movies.  Something must change and I believe with online media streaming and smart phones you will begin to see a shakeup in the cable and satellite industry as a whole.  

Time Warner Cable who is the current provider where I live has a new app where customers who owns an IPAD can watch TV anywhere in their homes, but that is limited to just being home. (Timewarnercable.com 2011)  DirecTV is currently advertising that subscribers can watch NFL games on TV, Laptops and smart phones, which is a small fusion to the online format. This programming is called NFL Sunday Ticket with other options such as Game Mix, Red Zone Channel and Short Cuts (DirecTV.com 2011)

The internet has the ability for programmers to directly offer their shows to be viewed directly to the internet but the current business structures keeps us trapped in an old technological wrapped box with the potential for new ideas right at our fingertips.  Of course programmers would not want to rock the boat since advertising is an integral part of their budget and viewership within the cable and satellite arena solidifies their business agreements. 

What would happen if a group of stations lets say Fox, ABC, NBC and CBS decided to show their programming strictly online with an online TV account like you have with cable and satellite? Could this be possible?  Would it be profitable?  I believe the system is currently being tested with the major networks making it possible to watch missed shows on their websites or on sites such as Hulu.com.  Would this raise the cost of Internet if they did away with the current system?  The most important question would be would any of them be daring to step into the technological future so we can free ourselves of the cable and satellite boxes to embrace the new world that is currently waiting?

Reference:

DirecTv.com 2011 NFL Sunday Ticket retrieved from     http://www.directv.com/DTVAPP/content/sports/nfl

Tmewarnercable.com 2011 TW Cable TV for IPAD Update retrieved from             http://www.timewarnercable.com/nynj/learn/cable/TWCableTV/TWCable TV_iPad.html

Will DVD Sales encounter the same fate as CD Sales?

I have read many articles on the declining growth of CD sales and how it has affected the entertainment and music industry.  While researching this topic I see that Wal-Mart is beginning to see the handwriting on the wall and partnered with Vudu to add video streaming. (Gigaom.com 2011)   Wal-Mart purchased Vudu 18 months ago and held on to its prized acquisition until now.  Why now? Well the decline of DVD sales and people seeking to watch content online has allowed Wal-Mart to adjust its business strategy.  This strategy will allow Wal-Mart to offer online streaming as well as the opportunity to purchase a physical DVD. 

Now if Wal-Mart is ahead of the curve what about the rest of the industry? Viacom faced the music earlier this year as they reported revenue decline as DVD sales dropped.  Viacom, which owns Paramount, made a strong showing at the box office but was offset by the drop in DVD sales.  The results were that DVD sales dropped 44% to $638 million. (Nytimes.com 2011)  Now if Wal-Mart, which sells DVD’s and Paramount, which produces movies, have faced decline then I believe there will be a shift in the future.  As consumer spending softens towards DVD’s and trends towards online viewing I believe studios, mega stores and cable firms will have to adjust.

Earlier this year in June, executives from HBO and Netflix discussed that DVD still has some potential growth in some markets.  Netflix states that on an average day customers are renting 45,000 titles out of the 100,000 titles they carry.  Now this is less than half of the inventory and I feel that online streaming will be the major boost of revenues in the future. (Mesalliance.org 2011) Now Netflix is in a good position to offer online streaming to its consumers as long as it gains permission from the studios to do so. 

HBO has also jumped onto the online streaming platform with HBO, which allows viewers to watch over 1400 of their favorite movies, and HBO shows on mobile devices and IPAD.  I believe this is just the spring board for HBO to jump into the streaming market if it needs to and if it does not agree with current arrangements with other vendors.  They see the writing on the wall as well. GO HBO

Reference:

Gigaom.com 2011 retrieved from http://gigaom.com/video/vudu-walmart-  website/

Mesalliance.org 2011 Netflix, HBO Talk DVD Opportunities Amidst Digital Growth     retieved from http://mesalliance.org/blog/2011/06/03/netflix-hbo- observe-opportunities-for-dvd-amidst-digital-growth/

NYTimes.com 2011 Viacom Profit and Revenue Decline as DVD Sale Drop retrieved             from             http://www.nytimes.com/2011/02/04/business/media/04viacom.html?_r=            1