Three Reasons HBO, CBS and Showtime Going OTT Could Be Good For Cable Providers

There’s been a lot of buzz recently about many well-known television and cable channels—like CBS, HBO and Showtime—taking the leap into the world of over-the-top (OTT) content.

While these kinds of moves are certainly understandable as OTT allows channels to reach out directly to their customers and give them more options, it begs the questions as to whether these jumps will spell the end of the line for cable providers as we know them today.

It remains to be seen precisely how these channels’ OTT products will fare and whether more channels will embark on similar journeys. And it also remains to be seen exactly what these new developments will mean for traditional providers.

But before jumping to conclusions about why cable providers should be worried, let’s take a look at three reasons these new OTT offerings are something cable providers can be excited about:

  1. Customers today do not think long and hard about paying for a service like Netflix. After all, it’s less than $10 a month, which is why the company’s able to boast 50 million subscribers. Let’s say that these new OTT offerings carry similar price tags. At the end of the day, a comprehensive cable package is likely to give customers many more channels for less money. It’ll also be easier for them to manage one bill rather than seven, for example.
  2. With companies like CBS and HBO relying on the Internet to get their content to their audiences, it’s likely that OTT providers will pressure cable companies to treat network traffic equally. This could go a long way toward ensuring net neutrality.
  3. Shows like “Game of Thrones,” “Boardwalk Empire” and “Curb Your Enthusiasm”—among countless other—lead many fans to think that HBO boasts a superior catalog than Netflix. So how would the world’s current number one OTT provider add value to compete with HBO? Some suggest that Netflix could choose to partner with cable companies, offering their services as HBO had in the past.

The rise of new OTT offerings could be viewed as a good thing: Customers will have more choice, and companies will have to continue to innovate in order to claim the largest slice of the pie that they can.