With millions of hours of TV content available at any time, consumers are no longer interested in paying for programming they don’t watch. In fact, over 54% of the US population are cord- cutters, cord-nevers, orcord-trimmers. With the rise of OTT (over the top) subscriptions within all age groups, questions about the future of huge media groups arise.
- 24% of TV time is spent viewing OTT compared to 7% viewing cable VOD.
- In 2017 there were 198.6 million OTT users compared to 196.3 million cable subscribers.
What does this all mean? Well… the possibility of companies like Viacom or CBS being acquired by streaming giants like Netflix or Amazon could be a reality.
MediaPost.com reports that business leaders are discussing the possibility of Netflix buying Viacom. With this acquisition Netflix would have:
- Ownership of cable networks like MTV, TV Land and Nickelodeon but also Paramount Pictures
- This would aid in its ever-expanding original TV and movie content.
Another possible change in media could be Amazon’s purchase of CBS.
- CBS has lost a large portion of their sports programming.
- If Amazon were to purchase CBS, it would allow them to compete with other networks by having higher bids for sports rights.
What are some of the more obvious reasons for these acquisitions?
- Amazon would have ownership of network TV
- Netflix would get traditional ad-supported cable TV networks.
What does that mean for the future?
- Well in the past, big media companies acquired traditional TV networks, so they could have the highest licensing fees from pay TV providers.
- This was especially important for poor performing networks.
With a possible glimpse into the future of OTT providers owning traditional media companies, the strategy of placing advertising dollar into streaming solidifies the fact that streaming really is the best way to reach viewers. The Watauga Group guides clients through the ever-changing world of OTT and helps reach target audiences wherever they are viewing programming.
Source: Medpost.com- New Media May Buy Old Media – For Surprising Reasons
Written By: LeEllen Smith & Shinice Johnson