Pay-TV Operators: To Cut or Not to Cut?
- Consumer adoption of over-the-top video streaming services, coupled with rising programming costs, have created significant headwinds for traditional pay-TV operators.
- Major technology companies are entering the streaming market with disruptive pricing strategies, putting more pressure on the traditional pay-TV industry.
- Despite the business challenges streaming services create for traditional pay-TV providers, they are a boon for the lucrative broadband industry.
- Deciding to deemphasize or exit the pay-TV business is scary given the potential rise in customer churn. However, our analysis suggests that this risk is fairly low.
- Some rural operators have demonstrated that by offering a white label streaming service, corporate operating margins can expand.
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