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1993 was a big year for me. I saw Jurassic Park and soon after got to see my first Silicon Graphics computers and visit their campus. When I watch that movie now, the dinosaurs look terrible but in ’93, I remember that first scene when the camera pans from the SUV to the brontosaurus and having my mind blown. It looked so real. It was a leap in computer graphics.
That summer I was at Disney Imagineering and had a Sun computer with Mosaic. I had only been on BBSs, AOL, Delphi, and Pipeline at that point. It was a step change in simplicity and open access.
I had a feeling by September of ’93 that computing was going to be 100 times better for me in 1994. Of course I was wrong, by the time I got to Princeton in ’95 it was 1000x better.
Last night I went to the DIRECTV Now launch event in NYC.
The product like the one from our partner Sling is the future.
It is full TV on every single device. Every channel, rendered perfectly, on Apple TV, Roku, Android, iPhone, Amazon Fire, Le Eco etc. The prices are crazy low.
AT&T has Spotified themselves in a way the music industry never did. The product is better and cheaper. The interface is 2017.
The only reason people will keep cable boxes is inertia. No one new will get a cable box unless they are confused. And education and time will correct this confusion. Certainly no one graduating college will even consider getting a cable box.
Further, this very bold move by AT&T, and previously DISH with Sling TV, will push competitors to move even faster. We already have indications of this from others we are talking to.
As of last night my conviction in our thesis is strengthened by a step factor.
There will be so much choice for the consumer that the tragedy of choice will be amplified. In this new world there will be no “default choice” for cable bundle. Consumers will question everything.
Bundlers will look to create great products at affordable input costs. Our opportunity to undercut and replace incumbents will be amplified. At these cheap bundle prices we provide a massive substitution opportunity for the bundlers. Plus our product is of course better and younger. We also don’t have the giant cost structure.
To make this not about us, why wouldn’t Tastemade beat Food Network? Their product is better, cheaper, younger, faster. Plus we already know no one under 50 is watching Food Network.
I think in 2017 everything in the TV ecosystem will be confused and up for grabs. I think we will see the single digit % cord cutting hit double digit %s. I don’t know why it wouldn’t. I think the volume of media means consumers are informed faster and switch faster. This will be Blackberry to iPhone in a one- to two-year period.
This is so much bigger than web replacing newspapers. And will be so much faster. It’s more like iTunes and Spotify to CDs. If we improve our content every f—ing day and get the distribution deals we win. It is that hard and that simple.
Jon Steinberg is the CEO of Cheddar, a financial video news outlet targeting millennials that delivers content over-the-top to online platforms. This column first appeared as a note distributed internally to Cheddar employees on Tuesday.
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