Now this is getting interesting. I’ve written quite a bit about the future of cable companies, the impact of streaming services and all the deals going back and forth between Comcast, Time Warner Cable, Apple and Netflix.
The one voice we hadn’t heard from much was one from the satellite companies. Now we have.
Several news outlets reported that DirecTV and Dish Network are considering a merger, an idea that was blocked by regulators in 2002 because of antitrust laws. Basically, the government found back then that the merger would create a satellite TV monopoly.
But these are vastly different times. The competition for both DirecTV and Dish is no longer just each other – or even just the cable companies. The competition is Netflix, iTunes, Amazon Prime, Hulu and HBOGO. Consumers were slaves to the carriers back in 2002.
Today, they are all trying to figure out the new paradigm. That’s why you are seeing so many transactions being played out. Comcast becomes the 800-pound primate if its merger with Time Warner Cable comes through, leaving Netflix to pay a fee to have its services streamed across Comcast cleanly and potentially joining Comcast with Apple for their own streaming service.
What would a DirecTV/Dish merger look like? I suspect this is in direct reaction to the Comcast/TWC merger, meaning the resources that cable company would have would out-do anything DirecTV/Dish can do separately. Together, they would be able to mount an offensive that includes a streaming service, original programming and other features to steal market share.
The playing field is now about content. Netflix and Amazon are in a bitter war over rights to certain programming, while content providers operate Hulu and other providers (HBO, FX, History, etc.) have their own apps that show programming.
This is a fight is over money. To compete, you need lots of it to acquire the rights to programming. Because of the need for wads of cash, there could be further consolidation until we, as viewers, are left with only a few choices.
Then we’ll become slaves to them once again.