Streaming Content: Will it force Cable and Satellite to adapt?

Last year I introduced Netflix’s rising stock price due to domestic and international streaming content demand by consumers. One year later the competition for consumer’s viewership is heating up through several digital mediums. There are more streaming content development spending dollars today than ever before for mobile viewership.

Remember Blockbuster Video and Hollywood Video stores? Remember when you would walk in to either store and get excited?  Guess what?  You no longer have to stand in line!

What happened in the last decade? Aside from Redbox, we no longer go to the store and stand in line to rent media content. Why is this? An advent of companies gave birth to large streaming content otherwise known as Amazon Prime and Netflix.  We don’t like waiting in line for food. We don’t like waiting in line for books. We don’t like waiting in line for anything anywhere!

The most drastic change in media is occurring in front of our very eyes right now.

Comcast, Twenty First Century Fox, Time Warner, Walt Disney Co, Viacom and CBS are all fighting for consumers to view their content. Only recently have all of them started investing into streaming on-demand content and none of them have any popular platform for consumers to view their content.  The streaming content is currently dominated by Netflix and Amazon- and it’s not even close.

Netflix, based in Los Gatos California, was founded by Reed Hastings and went public in 2002. Netflix spent $650 million on technology development expenses according to their recent fourth quarter income statement.

Amazon on the other hand has invested into streaming content through its own version called Amazon Prime. According to our SHSU Library’s Mergent Databse resource, Amazon had $2.9 billion content expenses in 2011. At the end of 2015, Amazon had an astounding $12.5 billion in content expenses. Amazon is clearly spending an immense amount to provide the technology and content for consumer demand.

We all live in an age of on demand services- whether it is for your appetite, fitness needs, digital needs or educational needs. There are thousands of applications at your fingertips to get on demand at any time of the day.  You don’t even have to leave your home and step foot outside to get anything you want these days. Businesses are adapting to on demand more than ever and more importantly consumers demand for on demand services is accelerating higher.

If the famous content providers we know of don’t adapt to the current on demand content trend, they’ll all be looking behind as their valuation and viewership diminishes.

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