Videonomics

Can YouTube and HBO GO Take Down Big Cable?

With more than 800 million monthly unique visitors and billions of videos consumed each day, YouTube still has trouble convincing people that it’s a legitimate video contender. While it remains true, that television still drives the biggest dollars, and is the preferred medium of display entertainment in most households, YouTube and online video has progressed to levels many didn’t think was possible.

The success of YouTube, Netflix, and Hulu is derived from a convenient compilation of advancements in technology and an uptick in mobile browsing. Smarthphones, tablets, internet connected televisions, gaming consoles, Facebook, and Twitter have forever changed how we consume media. But we all know that. That’s old news, right? So why is it that YouTube and other video distributors still aren’t seen as serious competition to Big Cable?

In 2011 Google offered YouTube entrepreneurs and hopefuls access to 100 million dollars of funds to help launch custom channels. This year Google announced another fund of 200 million dollars to promote and create its programming. The success of YouTube comes from its need for engaging content. Unlike television, which consists of many sub-par surviving by clinging onto a huge network or popular time-slot, a YouTube developer must work diligently to provide his or her audience with great specialized content or they will be overtaken and forgotten.

With the focus on content first and profitability second, it allows for YouTubers to create more unique and entertaining content, which in turn leads to more money. Where television networks can launch 12 new shows, costing millions of dollars, simply hoping that two of them will actually succeed, YouTube video creators have a much shorter leash. And with a short leash, its takes more effort and thought to actually get to the next level.

Big Cable likes to disregard the growing dissatisfaction with huge cable bundles and huge cable bills, but the more comfortable people get with online video consumption, the easier it will be for them to finally cut the cord. With apps like HBO Go teasing consumers with how great cable-free premium programming could be, it won’t be long before people figure out that opting out of cable, will be the only way to push them to offer something else. HBO Go has over 29 million current subscribers and of those 29 million I bet that 28 million of them would rather pay for the app itself, instead of a paying for a HBO package that includes tons of unwanted channels.

*That asterisk is the only thing holding millions of cable subscribers from cancelling their subscription

The ease of use and availability of tons of programming and exclusive content makes the application superb. Not to mention the fact that the company could stand to make even more money by detaching from huge cable bundles.

One developer took on the challenge himself creating a website called takemymoneyhbo. He writes “We pirate Game of Thrones, we use our friend’s HBO Go login to watch True Blood…Please HBO, offer a standalone HBOGO streaming service and Take My Money!”

If enough people take on this charge, and continue to watch YouTube and HBO Go and cut down on their bundles, Big Cable will have to listen.

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