Content Is King, But It Won’t Be For Long: Analyst

This won’t go over well with the media moguls hobnobbing at the Allen & Co retreat in Sun Valley. But it’s the thesis behind the “neutral” rating that Barclays Capital’s Kannan Venkateshwar assigns to Big Media in his smart new 100-plus-page inaugural report on the industry. The major players — CBS, Discovery, Time Warner, Fox, Viacom, and Disney — make most of their profits from television. And although revenues in the field have grown over the last five years, “the source of this growth in most cases (with a few notable exceptions) has been through price inflation and an increase in the advertising inventory rather than a more sustainable growth in ratings,” he says. That spells trouble as Netflix, Amazon and others also produce content for the Web, and pay TV distributors including Comcast and DirecTV strike merger deals that make them stronger. They focus on shows and search engines — not networks and schedules. And as they forge stronger ties with subscribers, “traditional media companies get pushed further back into the value chain, further away from a direct relationship with the consumer.”
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This article was printed from https://deadline.com/2014/07/big-media-content-distribution-stock-trends-801105/