The companies that offer pay television services are in the midst of a revolution in their business model. They seek to remain relevant amid the reconfiguration of content consumption due to digitization, which has given way to the emergence of various streaming platforms.
“The model of selling 200 channels is not going to survive any longer because people are now interested in contracting certain channels or types of content,” says Anderson Ramires, lead partner of TMT & Digital Services at PwC Mexico.
Some have begun to package the platforms within their offer, which has allowed them to remain attractive, and even Televisa and Megacable cable companies have recognized that this strategy has helped them retain their subscriber base, which has translated in positive numbers for companies.
According to the study Global Entertainment & Media Outlook 2022–2026 Mexico Chapter, by PwC, this year the restricted television segment will generate revenues of 4,619 million dollars, which implies an increase of 8% compared to the 4,288 reported in 2021, this thanks to the triple play plans.
While streaming will generate this year sales in Mexico for 1,257 million dollars, which represents an increase of 12.8% compared to what was obtained last year.
Although pay television continues to generate more sales than the platforms thanks to the strategy of being content aggregators in its cable packages, the industry still faces several challenges to continue being one of the subscription options for consumers, due to that part of the programming that used to generate ratings, such as sports content, has begun to fragment between the different streaming platforms. This year, Dish had to withdraw sports channels, after failing to reach an agreement with Fox Sports.
Ramires assures that one of the options that pay television has is to venture into streaming. Some have already taken the first steps.
This year TelevisaUnivision launched the ViX platform in which the programming portfolios that have been developed throughout its operation converge, and which incorporates sports content. In addition to contracting the platform, users can also access it via Izzi, Grupo Televisa’s cable company. “Hire internet plus izzi and get Vix+ free of charge this year,” says the cable company’s announcement on its website.
Another option that pay television companies have, says the PwC director, is to develop sub-packages or applications that focus on certain genres of entertainment to be sold individually, for example sports. “Now pay television companies can make payment packages to access a certain content offer on their own digital platforms.”
Inflation, the other challenge
Ramires assures that inflation will drive some clients to cancel subscriptions, so the cable companies “need to generate value-added alternatives to have the lowest dropouts and to attract new subscribers.”
Some options mentioned by the specialist are maintaining subscription prices, bundling various services – cable, internet, telephone and streaming – or providing an extra service such as allowing access to content at any time, something that Dish carries out.
