Is Streaming Truly the Future of Television?

With the rise of video streaming services, a common question arises: are traditional television and cable services being replaced by streaming? This article delves into this topic, exploring the current trends and examining the future landscape of the television industry.

The Decline of Cable TV

Traditional television and cable services have faced significant challenges, particularly with the proliferation of streaming platforms. For instance, companies like Comcast and Xfinity, once beloved for their extensive channel lineups, have recently become prohibitively expensive. This has led many consumers, including those who have relied on cable services for decades, to 'cut the cord,' embracing streaming services as a cost-effective and flexible alternative. The general sentiment among users is clear: why pay a hundred dollars a month for a hundred channels when only a few are actually watched?

The Rise of Over-The-Top (OTT) and Connected TV (CTV) Services

Over-The-Top (OTT) video and Connected TV (CTV) services represent a significant breakthrough in the video media industry. Sixteen years ago, large North American telecom companies recognized that merely selling 'naked Internet' would not be profitable and would not help them meet the revenue targets of their shareholders. Consequently, these companies began making substantial investments in media and entertainment, leading to a wave of mergers and acquisitions involving news media, TV, movie studios, and even tech companies like Yahoo.

Innovations in Technology and Codec Standards

The future of television broadcasting is closely tied to advancements in technology, particularly in video codec standards. Current streaming services such as Netflix, Amazon, and Apple continue to thrive, largely due to their ability to innovate and adapt to changing technologies. The development of a superior video codec could significantly boost the quality and efficiency of streaming, making it a viable alternative to traditional television broadcasting. Improved codec standards could revolutionize the way television programs are produced and consumed, offering better picture quality and smoother streaming experiences.

The Role of Telecom Companies in Streaming

While telecom companies have entered the streaming landscape, they currently face challenges in competing with OTT services. Telecoms possess the ability to offer lower-priced alternatives to OTT services, but these companies must carefully balance their strategic goals with their financial obligations. Telecom companies are under pressure to generate revenue to pay off billions of dollars in debt, making it unlikely that they will engage in aggressive market share acquisition through price competition.

The Future of Television Broadcasting

Television broadcast will continue to play a crucial role in live news, current affairs, and some movie screenings. However, the internet still has limitations, such as buffering and network stops, which can detract from the viewing experience. As the internet improves and a superior video codec is developed, it will significantly change the landscape of television, potentially leading to a shift in viewer habits. In such a scenario, streaming services like Netflix would likely gain more subscribers, as users seek a seamless and high-quality viewing experience.

In conclusion, while streaming services are undoubtedly changing the media landscape, traditional television and cable services still hold a significant place. The future of television broadcasting is likely to be a mix of both, with streaming services offering more flexibility and lower costs, coupled with the reliability and quality of traditional broadcasting. The evolution of technology will play a critical role in determining the balance between these two mediums.