Telephone companies are now having to make a tough choice between sticking with the communications business or going all-out with a big investment in the television market, according to a new report.
The Business Case for Broadband Entertainment report from Analysys says, providers of broadband are weighing up the possibility of streaming television content over the internet, which has the potential to generate high revenue returns, but breaking in to this established market could prove to be tougher than expected.
To be successful, broadband providers will need to offer excellent programming content to draw in the massive audiences needed to turn the profit dreams in to a reality but this could prove to be quite a struggle.
Existing broadcasters will have the edge over broadband because they already own the rights to a number of sporting events and Hollywood blockbusters, which leaves broadband left with limited programming choice unless they are prepared to pay a high price to tempt content providers away from existing deals.
However, paying such as high premium is a big risk because audience viewing figures are not guaranteed, says Analysys, and warns broadband providers that entering the television market may not be worth the gamble involved.
Analysys said that the sensible approach in the European market would be for broadband providers to team up with existing television market players or offer an open platform for third parties to use and in this way, telecommunication companies may still be able to take a significant slice of the â‚Ź20 billion pay-television market.
Related Links
