The digital media industry has undergone significant changes as companies like Netflix, Hulu, and Amazon have "unbundled" the traditional television model by hosting, curating, distributing, and monetizing content independently. This has disrupted the $290 billion global TV market as consumers now demand content on their terms via streaming platforms. As marginal distribution costs approach zero and viewers shift to mobile, television networks must adapt by focusing on engaging content instead of distribution deals. Large tech companies are also seeking to leverage existing users and infrastructure to enter the lucrative TV market.

1. Sources
The Great Unbundling
How the rise of OTT content and platforms
changed the TV media industry
Steeve Vakeeswaran
Breather. “3 Dufferin Avenue” Unsplash.

2. Dettlaff, Torsten. “Space Gray Iphone 6” Pexels.
Shows like “Orange is the New Black”
garner roughly 6 million people
watching the season premieres within
48 hours … a stat launching it amongst
the most-watched cable programs [1].

3. Dbreen. “Popcorn Movie Party Entertainment” Pixabay.
Amazon recently won 3 Oscars for
films from Amazon Studios - none of
which were produced in a traditional
production studio setting [2]

4. Iven, William. “iPad Apps” Unsplash..
SOWhat is happening to the TV industry today?

5. Bresciani, Emanuele. “Times Square” Unsplash.
Digital media companies have unbundled the
entire media stack [3]. They can:
Host
Curate
Distribute and
Monetize media content.

6. Yap, Jeremy. “Old School Projector” Unsplash.
No longer do the economics of bundling
work where consumers had to pay $99
for a basket of channels when they simply
wanted to watch 1 program [4].

7. Instead, over 65 million subscribers
use OTT (Over the Top) solutions like
Netflix, HBO, Hulu, Sling TV and
others for a flat monthly rate [5].
Kreuter, Jens. “Black Flat Screen TV on White Wooden TV Rack in Living Room” Unsplash.

8. Fancycrave1. “Ipad Tablet Technology Touch” Pixabay.
SOWhy is this happening to the TV industry?

9. Eletu, Olu. “Financials” Unsplash.
$290 billion global television market is being
disrupted by six billion mobile devices and a
new generation of consumers demand their
programming on demand [6].

10. Campbell, Lee. “Coder” Unsplash.
A lot of it has to do with the rise of over the top platforms that don’t
make people hate TV but the way in which they consumer it:
there is a rise in mobile attention [7]

11. Sources
Gouw, Tim. “Puntimm” Unsplash.
The downward pressure on cost of rights, advertising and the MVPD’s clout is bringing
down the incentive for content providers to use large networks and cheapens the cost of
distribution [8]

12. Wait - what’s an
MVPD?
MVPD’s are multichannel video
programming distributors with
access and carriage rights. Think
of Time Warner Cable, Comcast,
Dish Network, etc [9].

13. Sources
Heyerdahl, Carl. “Do More” Unsplash.
Therefore, the near zero marginal cost of
distribution has the industry “zero rating”
- where T-Mobile users can stream
unlimited music/video content without it
counting towards their data cap [10].

14. Sources
Pavlov, Ilya. “Code” Unsplash.
SOWith all of these changed, what’s next for the TV video industry?

15. Sources
Nazifi, Farzad. “Workdesk” Unsplash.
Television networks will have to compete on the
basis of creativity, content and their ability to
engage fans. Networks like AMC engage Walking
Dead fans with Snapchat filters, interactive quizzes
and other social campaigns to increase buy-in [11].

16. Sources
Kudinov, Vladimir. “Manhattan” Unsplash.
a. No longer are viewers limited to
watching content available on
their geographic TV networks -
creators and OTT”s like Netflix
can use their platform for global
content.
No longer are viewers limited to watching
content available on their geographic TV
networks - creators and OTT”s like Netflix can
use their platform for global content [12].

17. Sources
Iven, William. “Checking News” Unsplash.
There will be more vertical consolidation in the media
space as we see more cases like
AT&T (internet, wireless and pay TV provider) acquire
Time Warner Cable (media powerhouse) [13]

18. Sources
Guay, Matthew. “Trello and FT” Unsplash.
Large technology platform will try and seek to enter
the TV market to leverage their existing user base
and advertising infrastructure to the $500 billion
subscription and ad revenue generated
by the TV industry in 2019 [14]

19. Sources
Spiske, Markus. “Sunset” Unsplash.
YouTube launched “YouTube TV” which is an offering of 40
channels for $35. It is uniquely positioned with its hardware
business (Chromecast) and online platform to strike millennials
in a new, engaging way.

20. Sources
Elutu, Olu. “Sound” Unsplash.
2.3 million people joined Twitter’s NFL live
stream and engaged with hashtags and
content on the platform in September [16].

21. Sources
Alphacolor. “Duck58Cth” Unsplash.
Facebook has been investing in amateur and
premium content on its Live feature to build
up a large enough viewing to justify entering
the live TV and sports market [17].

22. Sources
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[4] Haile, Tony. "The Facebook Papers, Part 1: The Great Unbundling." Recode, 09 May 2016. Web. 03 Mar. 2017.
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2017. Web. 03 Mar. 2017.
[6] Williams, Alex. "For Millennials, the End of the TV Viewing Party." The New York Times. The New York Times, 07 Nov. 2014. Web. 01 Mar.
2017.
[7] Samit, Jay. "OTT Video Is Creating Cord-Extenders, Not Cord-Cutters." Harvard Business Review. HBR, 17 July 2015. Web. 01 Mar. 2017.
[8] Lapowsky, Issie. "What Television Will Look Like in 2025, According to Netflix." Wired. Conde Nast, 19 May 2014. Web. 01 Mar. 2017.

23. Sources
[9] Arthofer, Frank, and John Rose. "The Future of Television: Where the US Industry Is Heading." BCG Perspectives. The Boston Consulting
Group, 09 June 2016. Web. 03 Mar. 2017.
[10] Silbey, Mari. "To Be or Not to Be an MVPD." Networking the Cable Industry. Light Reading, 6 Apr. 2015. Web. 03 Mar. 2017.
[11] Philips, Jeremy G. "Don’t Look Now, but the Great Unbundling Has Spun Into Reverse." The New York Times. The New York Times, 14
Feb. 2017. Web. 03 Mar. 2017.
[12] Anderle, Megan. "CES 2016: Predictions for the Future of Television." The Huffington Post, 08 Jan. 2016. Web. 03 Mar. 2017.
[13] Anderle, Megan. "CES 2016: Predictions for the Future of Television." The Huffington Post, 08 Jan. 2016. Web. 03 Mar. 2017.
[14] Sun, Leo. "Could AT&T's Purchase of Time Warner Crush Netflix?" The Motley Fool, 01 Jan. 1970. Web. 03 Mar. 2017.
[15] Luckerson, Victor. "Hulu, YouTube Could Change How We All Watch Television." Time. Time, 6 May 2016. Web. 03 Mar. 2017.
[16] Alba, Davey. "Google Takes on Cable With ‘YouTube TV’-40 Channels for $35." Wired. Conde Nast, 28 Feb. 2017. Web. 03 Mar. 2017.
[17] Peterson, Tim. "2.3 Million People Watched Twitter's NFL Livestream, Less than Yahoo's." Marketing Land, 16 Sept. 2016. Web. 03 Mar.
2017.