Analyst Says TV Everywhere Means Money Everywhere
Time Warner CEO Jeff Bewkes’ campaign to get the television industry to adopt TV Everywhere might be paying off.
In a new report, Laura Martin, analyst at Needham & Co., estimates that over the next 3-5 years, TV Everywhere could add about $12 billion of revenue annually to the U.S. TV ecosystem, which currently generates $165 billion — $85 billion in subscription revenue and another $80 billion in advertising dollars.
For content owners, Martin figures that TV Everywhere could add about $10 billion a year of advertising, with Bewkes’ Time Warner and Walt Disney being the biggest beneficiaries because they are the furthest along in rolling out TV everywhere.
A big part of that gain comes as viewers shift from using DVRs to record programs — and skip commercials — to using TV Everywhere, which requires less planning and reduces commercial avoidance.
Overall, the extra revenue would translate into increasing the market capitalization of companies in the content business by $24 billion to $48 billion over the next five years.
Martin also estimates that TV distributors could see about $1.7 billion per year of revenue thanks to TV Everywhere by making their offering more attractive and boosting their pricing power.
“These dollars dwarf any near-term revenue streams from digital platforms (Hulu, YouTube etc.),” Martin says. “Additionally, these are low risk dollars as adding services to the TV bundles suggests additional revenue rather than economic cannibalization.”