TV Industry Update

March 26, 2014

justice-dept.-logoOne of the latest developments in the Time Warner Cable/Comcast merger is that the attorney generals of several states, including Florida and Indiana, will be meeting with the Department of Justice to determine if the proposed merger violates US anti-trust law. The focus of the inquiry is on the broadband service that the combined company would provide. As it stands now, the merger of Comcast and TWC would control about 40% of the US broadband market and 30% of the cable TV market. As the internet grows increasingly important for both homes and businesses the attorney generals are concerned that too much market power would be held by one company, limiting competition and innovation and potentially raising prices.

In addition, Governor Cuomo of New York changed the mandate of the state’s Public Service Commission to give it more regulatory power over media mergers. The burden is now on the media companies to show how a merger is in the best interest of the public. So even if Washington okays the merger, New York may not follow along.

In another blow to cable companies, they continue to lose pay TV subscribers. Investors.com reports findings from the most recent SNL Kagan report Channels OTAand the results are not good for pay TV. “In 2013, the U.S. multichannel video business posted its first ever full-year decline in subscriptions…across all pay TV platforms — cable, satellite and telecom — the industry lost 251,000 subscribers last year.” The loss of 251,000 subscribers is a minuscule amount given the size of the pay TV industry. But this is the first time there has been a sustained loss over a year. The big question is as the pay TV industry matures where will viewers go to get content? OTT is a viable option, though it does have costs associated with it.

Over-the-air isn’t going away any time soon, as seen by the variety of new and original series put out by the networks. Mohu’s Channels, available on Kickstarter, will combine OTA, OTT and take free web content and play it on your TV. It looks like there will be more changes in the world of TV in the next five years than in the past 20. Stay tuned.

 

 

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