One company’s cannibalization is another company’s disruption. This is the conundrum of our time. Companies are hesitant to cannibalize their own business, which opens them up to others disrupting their business (think Blockbuster, Kodak).
Case in point the (legal) battle of Aereo vs Broadcasters (see below for brief explanation). In this battle, there are two things to consider:
1) The business model of content creation and distribution is changing by the day. This is not a trend that is likely to reverse – it is probably gaining speed. By not addressing what the benefits are in the new emerging models (and granted many of the broadcast companies are) the broadcast and cable companies are setting themselves up to be disrupted – enter Aereo. Customers have been complaining for years about cable’s costs and limited choice of providers – it is not new news.
2) We learned back in the late 90’s and early 00’s that suing your way to dominance doesn’t really work (think RIAA, who even sued customers!), because customers will find a way to get what they want and in the case of RIAA (Recording Industry Association of America) they didn’t benefit from looking to the future – but Apple did.
Really the only thing that will truly save the broadcasters (and other big companies) is to re-think their economic and distribution models as new models emerge. The New Product Economy will be made up of niche market/providers and will require companies to be nimble and proactively paranoid to survive.
Learn more about the “New Product Economy”.
Brief explanation: Aereo, through too much technology to explain here, makes it possible for its members to stream (TV via Roku and iPad) several broadcast channels for about $80/year (quite the bargain against cable). [I have it and I love it but that’s not why I’m writing this post.] Broadcasters, who receive carrier costs from cable companies, don’t get paid for what is streamed through Aereo (which uses antennae to pull the content in, just like the old days, which must still protected by legislation.)