Wednesday, August 12, 2015

Traditional TV under fire – Milenio.com

Steps in the roof. That are feeling the traditional TV companies.

Last week, the stock market sent them a withering signal. During the two days of the quarterly report of its results, four of the top companies in traditional television worldwide: Time Warner, Walt Disney, 21st Century Fox and Viacom, they lost between 10 and 20 percent of its value market. The reason? The fear of investors to digital TV.

For some time the internet television has threatened to undermine the dominance of traditional television, both open as pay. Now the threat has become reality. Broadcast television and had been losing audience. But there was the consolation that TV cable and pay-for satelital- still generating growth.

No more. As was evident in the results of the four companies mentioned above, more and more users pay television are opting to cancel their subscriptions to focus on Internet TV. These users, who have been called the cord-cutters (short cords), prefer the convenience and price of a television offering video on demand and access from any mobile device to one that has steadily increased their prices and that has forced them to pay packages with channels that do not want to see.

While the actions of the four traditional TV companies collapsed last week, Netflix, leader of the litter Digital television companies that are unsettling the market, its stood at record highs; thanks in large part to a robust increase in the number of subscribers. This contrast only confirms the migration of consumers of pay television to digital.

The trend seems clear and it is reasonable to think that, as with technological change will accelerate. Just extrapolate about 5 or 10 years to see the impact it can have on the finances of the traditional TV companies. The fear is justified.

To predict what will happen in Mexico often you need only look north. United States sets the tone. It is true that as yet unseen near a turning point in Mexico as that country is living: pay television has much room for growth and penetration of broadband Internet is still very low. But the signal is clear: traditional TV companies in our country eventually also suffer the ravages of Internet

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