John Malone: cable MSOs should create national Netflix rival
Michelle Clancy | 11-10-2013
Liberty Global's John Malone, whose name is synonymous with the development of the cable TV industry, said that cable companies should unite on an over-the-top (OTT) effort to take on Netflix and Hulu—as well as IPTV and satellite.
Speaking at Liberty Media's investor conference, Malone counselled cable MSOs to eschew separate TV everywhere services in favour of one standard online video service, funded by all of them, so that they could share programming costs and drive margin into the service. And, unlike Netflix et al, cable companies could bundle it with broadband.
Some sort of move is required, he added. "The cable industry has been very slow (which has) created a window of opportunity to the over-the-top guys," he said.
The gambit — palatable considering that cable networks don't compete against each other but instead have separate, non-overlapping geographies — would help differentiate the segment and stop the subscriber drain that it has seen in the last few quarters in the United States. As precedent, Malone noted that the creation and funding of HBO "made us all rich".
Wunderlich securities analyst Matthew Harrigan told Reuters that the idea is easier said than done, thanks to disparities in technology advancements in various MSO networks. "It's kind of like herding cats," he said.
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