Big Telecom's War for Content

[Commentary] The tendency to over-fuss about media deals is vast, but remember that cable, satellite and phone companies for the most part are just resellers of TV content. TV is a sweetener -- a relatively profitless sweetener these days -- to their core business of providing a communications network.

Today's consolidation wave is best seen as a war for this sweetener among sellers of commodity-style communication networks. Comcast wants to merge with Time Warner Cable to negotiate better deals with sports leagues and Hollywood production houses. Satellite operator Dish has a vision, hazily, of expanding its service to mobile users over spectrum that Charlie Ergen has been buying up. Verizon bought a budding TV service from Intel to distribute over the Internet to Verizon's mostly mobile subscribers. The content sweetener is considered still vital -- up to a point. This brings us to the two conundrums of the media future: bundling vs. unbundling, and broadband vs. broadcast. If you are among the millions of households on the increasingly superfast Internet grid, will you even need a cable TV sweetener in the future? Or will you acquire content a la carte? But rolling fiber to the door of Americans in many places is likely to be unprofitable and customers may not want to pay for it. If customers are relying on relatively slow fixed or wireless broadband -- both of which AT&T specializes in -- continuing to get most of their TV via broadcast and not clogging up their broadband channel may make sense.