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TV Everywhere is both cable’s “best defence” and threat

TV Everywhere is cable’s best defence against cord-cutting…

…but could accelerate the unravelling of the relationships that keep the industry going, according to Stuart Sikes, president of Parks Associates. Speaking on a panel session at the CTAM Europe EuroSummit, Sikes said that cable operators were not actively promoting TV Everywhere services to their subscribers. He cited the example of Swisscom, which had bundled TV everywhere with its top-tier offering. This, he said, did not address the danger of lower-tier customers churning.

Parks Associates research showed that about 10% of customers were looking to “cut the cord” in the immediate future, and that very few of these would be retained by the offer of TV Everywhere services. Awareness of such services remained low, Sikes said. However, consumers did see value in TV Everywhere and a significant proportion would be willing to pay for it, which presents both an opportunity and a threat to cable as consumers could turn elsewhere for such services, Sikes added.

While cable operators had good relationships with content providers, the issues involved in delivering services over multiple operating systems to multiple devices with multiple DRMs was challenging. Sikes said that revenue from TV Everywhere would not be significant enough to pay for infrastructure needed to support it. There was also a trend towards the replacement of high-value subscription services with relatively low-value over-the-top TV Everywhere services, he said.

“Pay TV operators may be in for a long period when their return on investment on these services will be negative,” said Sikes.

(more…)

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