Strategy Implementation and Evaluation
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Introduction
Cable industry is experiencing a shakeout because of declining numbers of subscribers. Whether traditional cable firms (such as Comcast) like it or not, the streaming TV revolution is occurring. Most satellite and cable TV firms have been hesitant to embrace the cord-cutting phenomenon. The most worrying experience is the declining numbers of Comcast subscribers who prefer using web-based and programming services. Comcast Stream is facing potential threats which keep the firm pressured to create innovation. Aliloupour (2016) opines that streaming TV is increasingly gaining popularity as many customers are more comfortable with the service to replace the cable. Whereas major cable firms are not out of business yet, they have certainly witnessed their market share decline in recent years. Hoelck and Ballon (2016) identify that one of the greatest concerns for cable firms like Comcast is that cable customers are minimizing their bills through combining streaming TV options. Examples of streaming TV options include Starz, Showtime, Sling TV, HBO NOW, live sports via streaming TV, and other various programming channels. Now, being that streaming options have become more relevant than traditional cable TV, how can Comcast continue to hold its business up? The findings of this paper show that Comcast is strategically capable of competing with the looming changes in the environment associated with offering an a la carte approach to programming.
Issues Threatening Comcast
It is difficult to believe that a firm (that is Comcast) generating more than $6 billion in free cash flow over the previous nine months could be in trouble. Nevertheless, Hoelck and Ballon (2016) say that there are forces working which could ruin Comcast’s cash generating capabilities. Top video services of Amazon, Hulu, and Netflix and the internet of Google Fiber are two major issues that disturb Comcast’s future sustainability. These issues are threats to Comcast’s future since Comcast generates more than 70% of its cable communication profit from the internet and video services. Such threats continue taking Internet and video customers from Comcast over time (Aliloupour, 2016). Comcast understands the industry of cable firms is changing and has already adjusted its portfolio accordingly.
Comcast is now providing streaming services to counter the streaming services of Hulu, Amazon, and Netflix. Google fiber is a threat that could destabilize the cable industry. Google Fiber is currently on few cities but is expanding. Comcast is concerned about Google Fiber that is creeping into its market; therefore, the firm is providing subscribers in Atlanta with a new choice of its gigabit internet trial. Scottek (2016) explains that the internet promotional price of Comcast is $70 is similar to Google Fiber’s regular price though locks subscribers in for two years, which is longer than what Google is providing. The move that Comcast has adopted is meant to deny Google Fiber customers since Google enters into the Comcast’s turf. Moreover, Comcast offers Gigabit Pro service, which provides 2-gigabit downloads/upload speeds, and its internet price is lower and more affordable than that of Google Fiber.
Strategic Responses
Despite the threats facing Comcast, the company has shown that it is strategically capable of competing with the looming changes associated with offering an a la carte approach to programming. Hoelck and Ballon (2016) say that Comcast has options to make its business relevant. First, it can embrace the a la carte approach of television’s most popular channels. However, Comcast rejected the a la carte approach citing that the option has many challenges leading to the loss-making. The second option is to offer favorite shows and to create better services for customers. Comcast embraces the second option through venturing on programming and streaming to counter rivals such as Netflix, Amazon, Hulu and others (La Roche, 2016). Comcast is expanding online video services aiming to catch up with increasing demand alternatives of Netflix. Now, Comcast provides streaming services what is known as “a skinny bundle” of channels and HBO streaming video.
Comcast’s streaming service gives Internet subscribers access to cloud DVR storage, several broadcast networks, Aereo, and HBO to enable customers to watch broadcast channels such as Fox, CBC, NBC, and ABC over the Internet for free and even to record such broadcasts. La Roche (2016) views that the Comcast’s stream also enables subscribers to download and save shows into their devices and to watch them elsewhere. Stream’s prices are reasonable, and customers get HBO, broadcast networks including the ability to store programs in the cloud. The streaming is a modest service that Comcast provides to counter threats of the increase of services such as Apple internet TV service, PlayStation Vue, and Sling TV.
Comcast has responded to the cord cutting trend by striving to compete for consumer affection. The company also has invested in the main digital players like Vox Media and Buzzfeed to attract young people (Hoelck and Ballon, 2016). These investments are growing at a quick clip and are profitable. Moreover, Comcast has launched a slew of technologically related programs on its own platform. Recently, Comcast launched a digital video platform (know as Watchable) and an online streaming service (called SeeSo specifically) for comedy.
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