Content continues to be the focus of the cable industry with all the competition not only from other providers but also in the streaming space. Customers have multiple options and providers understand staying relevant is vital for survival.
Comcast understood that when they stepped up to buy DreamWorks in a deal valued at $3.8 billion in late April 2016. The deal should be finalized pending regulatory approval by the end of 2016.
Comcast said DreamWorks assets will join Universal Pictures, Fandango, and the NBCUniversal Brand Development as part of the Universal Filmed Entertainment Group.
The DreamWorks deal is far larger than Comcast’s recent content investments in Buzzfeed and Vox Media, each of which totaled $200 million. However, the acquisition pales in comparison to Comcast’s complete buyout of NBCUniversal in 2012 when the cable company shelled out $16.7 billion on top of the initial $6.5 billion in cash in put up for an ownership stake back in 2010.
This acquisition brings Comcast much coveted content in the form of film franchises like Kung Fu Panda, How to Train Your Dragon, and a library of currently animated programs. This new content also gives potential distribution leverage with Comcast’s Watchable online video service.
Comcast continues to grow in video space based on its acquisition of wanted content from other providers; as stated in my previous blogs How cable companies can stay in the game and How can cable win back cord cutters content remains the name of the game.
Bandwidth and cost
The two blogs mentioned above relate back to Comcast acquiring DreamWorks because it reminds companies they need to acquire more content relevant to customer wants.
Once the content is captured then providers can deliver it in the fastest and most reliable way through increasing bandwidth and lowering the amount of interruptions consumers see during shows, movies, and videos. Consumers are concerned with three things: content, bandwidth, and cost. Maybe call it the holy grail of cable.
According to the Leichtman Research group study in 2010, “83% of households still shell out money for cable.” It proves cable is not dead nor going anywhere as long as their customers are taken care of in terms of price, delivery, and variety in their content. Providers who aren’t willing to push the envelope with their services will be left for another provider to come and pick up the pieces and their customers.