Tomorrow’s Internet TV Will Still Have Ads
Probably sooner than later, TV will come to your house over Ethernet, not coax.
We’re seeing this change occur at an ever-quickening pace. Everything will be on-demand, like Netflix. And just like today, most of internet-fueled TV will still be ad-funded. There will be a few no-ad channels, just like Netflix and HBO are today. But most TV content will be ad-funded, there will be fewer ads than there are today, and the ads will be tailored to you. You’ll actually like the ads, because they’ll appeal to you about your favorite products or introduce products that are likely to become your new favorites. At least, that’s the plan.
The bellwether in this new landscape is AT&T.
AT&T CEO, Randall Stephenson, changed the game last year when he bought Time Warner. His vision centers around three things: On-demand content, 5G technology (which will impact traditional cable companies forever) and fully addressable, personally tailored ads.
These three things work together to make it easier to install a new customer. The bundles will be cheaper than current cable packages because the ads will be tailored to a household, there will be fewer of them, and all content, of which AT&T will own a large portion, will be on-demand. And let’s not forget…5G is mobile. Since AT&T can get economies of scale and controls both the largest satellite TV company and the largest mobile network, offering everything on-demand, and for less, will help them secure more customers.
Stephenson paid more than $80 billion for what may be the most premium content in TV, which includes Turner and HBO. Additionally, the Turner unit of Time Warner provides AT&T with one of the more sophisticated media companies that uses data for advertising sales. AT&T recently named Brian Lesser as CEO of its new advertising and analytics company and has a plan to deliver customized individual ad content across all your connected devices.
Don’t think this hasn’t gone unnoticed. Every media company, from Comcast to Disney, is losing sleep over this deal.
The good news for consumers is that the old TV ecosystem is unsustainable with a better one beginning to take its place. The bad news is that there will be some losers (distributors and networks) that may not make it to that ecosystem if they can’t adjust quickly enough. And just like everything on the internet, change happens fast.