If telco and cable service providers (MVPDs), whether large or small, need more to fuel the case for OTT video services, look to one of your major peers, Time Warner Cable. This week, it has been announced that TWC is considering an investment into Hulu.Clearly, a step like this indicates TWC's approach to include OTT video in their future strategy and business planning as a MVPD.
I thought Joel Espelien with TDG gave 3 good reasons why he thinks TWC would make an investment in Hulu, and implications for OTT. In summary:
- The majority of TWC's and other cable companies' revenues are coming from broadband services (DOCSIS 3.1?). With that in mind, it's smart business to partner with OTT video providers.
- OTT itself can become a very compelling bundling service to generate new revenue streams and boost broadband upgrades.
- TWC could break the "business model" deadlock created for Hulu (ads vs. SVOD) by its owners, mainly Disney and Fox.
TWC also recently launched TWC TV on Roku, offering live streaming TV channels to authenticated users. This was another bold move for an incumbent cable company to openly embrace OTT by launching TV Everywhere services on a pure OTT set top box like Roku.
Hulu's adventures and TWC's recent interest in Hulu and deployment on Roku are shaping the future of TV in front of our eyes. Service Providers can lead, follow or get (pushed) out of the way. And it doesn't take a multi-million dollar investment in Hulu. There is a large and rapidly growing industry of digital content producers and owners, increasingly ready to partner with MVPDs and explore new distribution channels. OTT platforms like Endavo can provide the flexibility to ease into it, if that's more comfortable... test the waters... get in the game. To be sure, telco and cable subscribers are spending more and more of their "TV" time going over-the-top to find what they want, when and where they want it... and, importantly, they are paying for it. Smart MVPDs like Time Warner Cable have figured this out. So now it's time to think outside the (cable) box and reach out to regain subscribers' attention (even find new consumers off-net) by launching new and innovative services over broadband, including premium OTT video.
That's how I see it. What do you think?