The millennial crowd is all about their Netflix, Hulu and Amazon Prime, and it’s caused investors everywhere to wonder if they should start dropping cable company stock and switch their efforts to something a tad more profitable.
Is it still possible to watch all the TV you want without the expensive cable bill? Let’s examine the cable alternatives.
While Netflix is currently in more than 40 million homes, their last earning statement was a slightly lower than what they wanted it to be. They were hoping for $1.97 billion where instead they saw $1.96. Shareholders saw a profit of 6 cents a share though, so still a strong report.
However, their expectations for global subscription once they expanded to more than 130 countries did not make the splash they were hoping for, which has caused both the company and investors to see another dip in their stock. It should be noted that people are highly anticipating their proposed ‘Watch Offline’ feature though which could be the bold move to get them back.
Amazon seems to excel at everything they do, and they hit the market for streaming in a big way with their Amazon Prime service. With independent shows of their own like “Man In the High Castle”, they’ve managed to steal some of the thunder away from Netflix — even when their original subscribers only cared about getting 2-day shipping.
Recently, they announced they’d start offering the streaming services separately as a monthly choice rather than the $99 annual fee for Prime. Currently Amazon is doing everything possible to add in content in the form of movies and games that is both in demand, and can’t be accessed anywhere else.
Hulu asks you to pay for its services and then still airs commercials during them which has turned many people off. They also haven’t seen the success they wanted with their original shows either. However, they’ve managed to keep up with the juggernauts because they offer people television that is still current. Unique to Hulu, they allow their subscribers a choice between paying for cable and a DVR if they still want to keep up with favorite shows in real time.
While cable companies are still favored by many, the feelings out there are somewhat mixed. One strong sign though of just how much they’re threatened by streaming is that they’re currently trying to shut down Hulu’s ability to stream new television and they’re starting to look into offering streaming services of their own.
Cable companies have long been vilified for poor customer service and the refusal to allow people the ability to unbundle subscriber’s favorite television stations, forcing them to include channels they’ll never watch. While they’ve done well in expanding their services for installing internet connections, cable companies have certainly dug in their heels for quite some time about how they deal with the average customer. It seems that while we seem indebted to them for now, terrible service and all, there is the possibility that this could change in the near future.
No matter how many articles you read, the truth always boils down to the fact that actions speak louder than words. At the heart of every rise and fall of stock, there’s a question of what consumers want. Right now, they may need cable, but the truth is that many would prefer not to have to rely on them.
Video streaming sites have replaced traditional cable plans in millions of homes, and streaming companies won’t stop there. Every company continues to look toward creating original content that will boost their memberships, and allow customers to watch in as many places as possible.
While streaming hasn’t instantly caught on en masse across the rest of the world like Netflix expected, it may simply be because it will take a little while for the true benefits of these sites to be seen in other countries. There’s nothing better than ditching an antiquated service for something that just makes more sense, so it’s a bit of a race to see who will offer the best package in the future.
As an investor, it’s important to look towards the trends. HBO, CBS and countless startups are all trying to be the next best thing in terms of offering content. When so many companies are trying to cash in, it’s a clear sign of shifting minds and changing winds. As an investor, your best is to see the innovations of both the past and present of all companies before diving in with your money.
