“Investors Pummel TV Companies On Ad Woes,” by Steven Perlberg and Shalini Ramachandran. The Wall Street Journal, 8/7/2015.
(This is still another old, unpublished posting, recently discovered, but is still appropriate.)
“More than $35 billion in market value was wiped out across seven media companies this week, as investors questioned the future health of the TV ecosystem.”
TV seems to be caught in a downward spiral as more and more viewers abandon cable because of its constantly rising costs, arrogant service, and increasing commercials. How do the cable companies respond to falling revenues? By raising prices, cutting service, and running even more commercials. Does this make sense? Only if you are a TV executive close to retirement.
Companies failing by regarding their customers as only cash cows capable of absorbing endless abuse is a common story. I am actually amused when I walk into my local Best Buy and see all of the unsold huge TVs, 60-inchs and up, OLED, in 4K definition, paired with ear-splitting sound systems, while people increasingly watch video on phones with tiny screens in low definition, listening with tinny ear buds, using only their Internet or phone service that they are already paying for. Companies who are so out-of-touch with their customers should go under. It is nothing to regret; this is how capitalism is supposed to work.
(I’m not predicting the demise of Best Buy. They are increasingly moving away from TVs and computers to big-ticket kitchen appliances, such as stoves, refrigerators, and clothes washers and dryers.)