VOD News: Virtual Cable Coming to the Web in 2012
By Karla Robinson
December 12, 2011
December 12, 2011
- Rich Greenfield, a media analyst at BTIG, makes predictions about “virtual” cable companies that he expects to become available online by next year.
- These companies will differ from VOD services like Netflix or Hulu in that consumers will subscribe to “real” TV delivered over the Web in real time.
- The contracts will not be a la carte and the virtual cable companies will probably have razor-thin profit margins — after paying higher-than-market rates for big TV channels/programmers.
- Although networks might shy away from virtual cable companies so as to not threaten their current deals with existing cable companies, the virtual programming may be beneficial to providers like Time Warner Cable, which will continue to offer broadband, where the profit margin is larger.
- Greenfield expects companies that aren’t yet involved in the video business to be the first viral cable providers as they look for another platform to expand their business. Companies such as Amazon, Google or Verizon might also be among the first to sign on.
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