Hey, if Conan O’Brien can predict the future, so can we
When he was a kindergartner, Barack Obama wrote an essay called, “I Want to Become President.” Forty years later, Obama told people he hadn’t always wanted to be president, and someone working for Hillary Clinton managed to find that essay, and called Obama a liar. The most amazing thing about that story is that an essay written in the pre-Web days of 1967 by a 6-year-old somehow survived to be cited four whole decades later.
If you publish anything now, of course, you can pretty much guarantee it will live on forever somewhere, probably on some forgotten mainframe in some remote corner of the Internet. Which is why predicting the future is such a joy. Guess wrong and your error will exist in perpetuity, waiting only for someone to Google it.
Not that that’s stopped us before. So here goes:
The Silver Age of Cable is over. At the end of 2007, cable started to lose basic subscribers, and from here on out, that’s going to happen on a regular basis. There might be the occasional fiscal quarter in which there’ll be a spike in net subscriber additions that might pump up the industry’s total. But if there are such increases, don’t bank on them being anything but intermittent.
Increases are still possible because the population is still growing, and because Verizon and AT&T are still in the process of rolling out their respective TV services. But they are rolling out their respective TV services, and those rollouts are only going to accelerate. On the positive side, anyone competing against Qwest should be happy.
And don’t forget DBS. DirecTV and EchoStar may have disadvantages, but they are not going down anytime soon, and if and when they do, they are not going down without a fight. John Malone is now finally in control of DirecTV, and that should be worrisome. He cannot go for the jugular, but he won’t play nice either.
Cable used to boast that DBS can’t do VOD. But with a DVR, DBS can do something that looks enough like VOD for their customers’ satisfaction. Nobody, and I mean nobody, is impressed with the charge that DBS can’t do “true” VOD.
Now cable is claiming that DBS can’t do addressable advertising. In 2008, one of the DBS duo will announce that it has devised a way to do addressable advertising.
Whatever the method, it won’t be as powerful or as flexible or as feature-rich as what cable can do. It might even be laughably crude. And it won’t matter. Because once addressable advertising takes off (which won’t be until 2009 for anybody – cable, telco or DBS), whatever DBS does, it will attract ad dollars. Why? No advertiser in his right mind will just ignore a potential audience of 30 million viewers.
Other competitors? Who? BPL? Stop it, you’re killing us. Okay, okay, a few ambitious energy companies will try it in 2008, but whatever broadband customers energy companies attract will together barely register as a statistical burp in the total broadband market.
Ooooh, “Statistical Burp” would be a great name for a blog...
Cable will spend record amounts on marketing and advertising. This year, and maybe next, will be the last opportunity to lock customers into bundles before U-verse and FiOS become widely available, and everyone knows it, including the competition, who will also be spending the big bucks to attract customers.
Speaking of Qwest, the era of big telecom mergers will continue without it. Possibly because many people in the communications industry have forgotten that there is a third incumbent still operating out there someplace on the western frontier. I mean, kudos for getting solvent and all, but seriously, who would be willing to pony up the billions of dollars required to buy Qwest, and then shell out more billions to fill out the company’s service bundle? Then again, the Chinese are flush – they’ve been floating U.S. investment companies, so maybe they’ll be willing to take on a telco project…
Suddenlink will buy a few more smaller companies. Investment bankers will entreat the company to go public because investment bankers don’t make money unless somebody does something, and they can’t ask Cox because Cox will just laugh at them.
The Dolans will attempt to take Cablevision private again, this time offering about $30 a share, a hefty premium. When it succeeds, everyone who rejected the Dolans’ previous bid because $36 was too low will be driven mad by Chuck’s uncontrollable and incessant chortling.
In 2008, cable will endeavor to not mention cellular/mobile telephony. Sprint has soured on Pivot, and will not help grow the service outside of the markets where it’s already established, leaving its cable partners in the lurch. Cable execs will not want to get burned like that twice, and whatever solution they come up with, it will take more than a year to put in place.
The solution will not be WiMAX. Except as a last resort, and we won’t know if it’s cable’s last resort before the end of 2008. WiMAX doesn’t look like it’s going much of anywhere in 2008 – not in North America anyway, though it may do quite well elsewhere.
But Intel is building WiMAX right into its processors, and those processors will make their way into millions of computers, and eventually that will entice someone somewhere – it’ll be too big an opportunity not to take advantage of.
It probably won’t be any of the leading cellular companies. They’re pursuing different 4G technologies, any of which can compete with WiMAX – which means WiMAX will be championed by companies who, by dint of limited resources, will have modest ambitions. This is not a recipe for explosive growth. And if Sprint ends up a key proponent of WiMAX, you can probably count cable out.
Google’s the wild card. If Google buys a lot of spectrum at auction a few weeks from now, then it might explore WiMAX, and it might offer the hand of friendship to cable companies. But not until it’s done planning and testing and trialing, and that won’t be until at least the end of 2008. We aren’t holding our breath.
Bandwidth. Cable has to buy bandwidth in 2008. It ain’t going to be with deep fiber. Fiber-to-the-home is the end game, and that won’t be until at least – let’s throw a dart here – 2015 at the absolute earliest.
And it ain’t going to be with node splits. Everybody just did node splits. Nobody wants to do any more node splits – not this year, anyway. Someone will split some nodes, but they won’t be starting a trend. That leaves at least half a dozen other options for buying bandwidth, and they’ll all be used, some in combination with others.
In a complete surprise, another 11,000 people will request CableCARDs in 2008.
Every major MSO will declare it’s deploying DOCSIS 3.0 technology, but if widescale deployments – really serious, extensive rollouts – of DOCSIS 3.0 occur in 2008, it won’t be until the end of the year.
At least one major MSO will experiment with metering broadband usage, but the experiment will be restricted to the highest speed, least subscribed-to tier of service. The attempt will elicit a howl of consumer indignation, and it will never be spoken of again...Until 2015, when consumers are going to insist that they should be able to send uncompressed HD video because that’s just the way consumers are.
That’s it: 2008 in a nutshell. Guaranteed. Then again, last year we guaranteed the Rockies wouldn’t win the World Series, and we needed the Red Sox to save our bacon on that one. Next year? Tigers over the Brewers in five.