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In Perspective - Mind Your Own Business

Sat, 04/30/2011 - 8:30pm
Brian Santo, Editor-in-Chief

You are in a great position to establish yourselves as the ultimate facilitators.

There’s an old saw about the 19th-century railroad tycoons’ failure to realize the business they were in was not railroads but transportation – much to their sorrow when rivals started beating them with alternative modes of transport.

Brian SantoWhat business are you in? Video? Communications? Networking?

Consider that you’re in the transaction business. That may seem like too minute a focus when your most notable transaction with your customers – sending them a bill – occurs only 12 times a year. But if you’re doing VOD, you are already tallying transactions at a far more frequent rate.

With VoIP, you are tallying every call. SDV and IPTV are, in essence, forms of video-on-demand. That these are flat-fee services is not the point – especially if you think consumption billing across all services is inevitable.

Speaking of consumption billing, Shaw is pleased with preliminary results from its experiment with premium channel a la carte. I believe the transition to the a la carte model is inevitable in the long term. It simply makes too much sense, especially in a three-screen environment.

MVPDs and programmers – at least some programmers – are more likely to come to an agreement on a la carte than many today imagine. If consumers already used to Netflix don’t want to buy a subscription to HBO, and some of them are still willing to pay for immediate access to “Game of Thrones,” why wouldn’t HBO and its distributors let them do so? There’s just too much incremental (i.e., transactional) business out there to ignore, and everyone can still get a cut.

Add t-commerce into the mix. That will be amplified with the expansion of the apps model into traditional MVPD markets (t-commerce is embedded in more and more apps).

Layer on top of that the micropayments trend, in which the major credit card companies and their partners are making it possible for all consumers to use their mobile devices as credit/debit cards.

As the operators of the networks that connect all of these devices and enable all of these transactions and more, you are in a great position to establish yourselves as the ultimate facilitators (middle men, if you will) – but only if you decide that’s any of your business.

E-Mail: brian.santo@advantagemedia.com

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