Impact of Convergence on the TV Industry

The question was posed to me- "How will the merging of TV, the Internet, and phones/mobile devices affect the television industry? Is it still just the TV industry?

The TV industry is multi-faceted. If this question refers to the content producers, the impact will be extremely positive. The platform convergence along with the democratization of content creation will result in the continued leveling of the playing field and the emergence of great innovation in content, with lots more places to distribute.

From a TV service distribution standpoint, the impact will be the negative erosion of the subscriber base for cable and satellite companies who have not made broadband a staple offering among their bundles. According to a recent report from ChangeWave Research, among traditional TV viewers, 20% say they're likely to downgrade or cancel their current TV service package in the next 6 months. The likelihood of canceling is highest among Cable subscribers (22%) and Satellite subscribers (22%), and lowest among fiber-optic TV subscribers (7%). Finally, from a TV advertising standpoint beyond the targeting, contextual and behavioral tracking benefits the convergence will provide, there is an overall sentiment that audiences will be more likely to engage with a brand on an interactive platform than the would be with a traditional TV ad.

While Boomers clearly want to see fewer ads than they do with conventional broadcasting, 68% say they are willing to view at least some ads online.


Broadband video now represents a significant threat to traditional TV viewing. According to the ChangeWave Research Study:

• 69% of Boomers say they've watched video content on their computer over the past 90 days
• 48% of respondents say they'd be willing to pay a monthly fee for a Video-over-the-Internet subscription if it provided the same programming currently available on their TV service
• 79% watch YouTube.com as the leading online website Boomers use to watch video
• 39% TV Network Websites
• 16% Hulu.com
• 11% iTunes

From the perspective of the longtail, the number of choices may be too overwhelming to consume on some of these devices unless software, search, and other providers begin developing deeper personalization capabilities to enable consumers to only get what they want or need on these devices instead of the entire universe of offerings.

Lastly, I believe the convergence will ultimately continue to fragment the overall media landscape, not just the TV industry and its respective la familias- bada bing!