Will TV Succumb to the Internet?

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What Competitive Forces Have Challenged the Television Industry?

In the 1990s cable and satellite TV flourished as the majority of the US households were subscribed (Dominick, 2009). However, in the late 1990s and especially in the 2000s the Internet became a serious competitive force. Such websites as YouTube enable people from all over the world to share video files (Laudon & Laudon, 2010). Illegal downloads of various video files (films, shows, programs, etc.) came into play. Admittedly, such accessibility of video files makes people forget about cable and satellite TV as there is no need to pay cable and satellite companies since one can download almost everything for free. Of course, many think that this can jeopardize the very existence of cable and satellite companies.

Describe the Impact of Disruptive Technology on the Companies Discussed in This Case

Notably, the Internet has largely affected cable and satellite companies. This impact resulted in certain changes. Thus, cable and satellite companies offer their subscribers online versions of the programs. For instance, Comcast Corporation has brought several Time Warner’s shows to the Web (Laudon & Laudon, 2010). Many broadcast networks (Fox, CNN, NBC Universal, etc.) have their own websites where their shows are broadcasted (Laudon & Laudon, 2010).

How Have the Cable Programming and Delivery Companies Responded to the Internet?

Of course, no one expected that the Internet could be a serious competitive force. However, in the late 1990s, cable and satellite companies acknowledged the seriousness of the situation. First, the companies started suing various websites (e.g. YouTube) for the illegal proliferation of shows, programs, etc. (Laudon & Laudon, 2010). However, soon cable and satellite companies chose another way. They decided to go to the Web. These companies launched projects to provide online versions of some of their products to their subscribers. Many companies have launched their official websites where some of their products are also broadcasted.

What Management, Organization, and Technology Issues Must Be Addressed to Solve the Cable Industry’s Problems?

Saxena and Stevens (2011, p. 9) claim that to compete with the Internet the companies should develop “direct-to-consumer delivery architectures”, and they should address “issues of fundamental business models”. The companies should find a way to encourage people to subscribe. Of course, the companies expand their brands bringing them to the Web. However, it is important to balance online broadcasting and cable/satellite broadcasting.

Therefore, it is possible to encourage people to subscribe by offering extra services online. This can be archived containing the most interesting projects. It is also possible to enable subscribers to participate in the process of some shows’ creation (inviting to the shows, etc.). The companies should also pay a lot of attention to the development of technology to provide their subscribers with high-quality services. Finally, the companies should address issues concerning advertising as too many ads may avert customers.

Have the Cable Companies Found a Successful New Business Model to Compete with the Internet?

It is necessary to note that the cable companies have come up with quite successful decisions as they provide their subscribers with high-quality digital products online. More so, Laudon & Laudon (2010, p. 119) state that this decision enabled these companies to earn “more advertising dollars”. Thus, online broadcasting has enabled cable companies to increase their advertising revenues as they can make several ad breaks during a show.

Some companies provide their subscribers with extra services (like entire seasons of some shows or series) for a certain fee. Remarkably, some analysts state that the abundance of adverts can negatively affect online facilities (Laudon & Laudon, 2010). Therefore, companies should reconsider the number of adverts. However, many analysts agree that cable companies can compete with the Internet. Of course, they will need to work out new effective ways to remain successful competitors.

If More Television Programs Were Available Online, Would You Cancel Your Cable Subscription?

As far as I am concerned, I would cancel my cable subscription if I had an opportunity to view the same products online for free. Of course, I understand that the companies will go bankrupt if they simply provide free products online. Nonetheless, this notion could not be a sufficient argument for me to continue paying for what is available for free. Many people will agree with such a viewpoint as the majority of households are facing numerous financial constraints nowadays.

Therefore, many people would be eager to pay less and get more. At the same time, I would not cancel my cable subscription if the companies offered some extra services online. I would be eager to pay monthly fees for some additional products. For instance, if I knew that my subscription could enable me to watch my favorite program earlier than the rest of the viewers, I would remain subscribed. Thus, if the number of television programs was quite limited or the time they appear online would be different from what could be available on TV, I would definitely remain subscribed. Besides, the number of ads provided during online programs could also make me remain subscribed as I feel frustrated if there are too many ads.

Reference List

Dominick, J.R. (2009). The dynamics of mass communication: Media in the digital age. New York, NY: McGraw Hill.

Laudon, K., & Laudon, J. (2010). Management information systems. Ney Jersey, NJ: Prentice Hall.

Saxena, V., & Stevens, G. (2011). Deliver content, experience, and value direct to the consumer. Web.

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