Cable Network's Lost Decade

In the past 20 years, cable networks have focused on the monthly subscription fee in the first 10 years and digital TV in the second 10 years. But today, when the three major telecom operators are vigorously laying out 4G networks, cable networks are still making a painful choice between VOD and OTT services. In the past 10 years, in addition to the overall migration of digital TV, cable networks have focused their main efforts on self-operated value-added services centered on data broadcasting, and have unknowingly missed the best historical opportunity for IP network construction.

"Should we build a broad network highway, allow numerous OTT virtual operators to freely conduct business, and let the cable network share a small part of the revenue of each business?" or "Hold all possible value-added services in our own hands, be self-sufficient and entertain ourselves in a closed garden?" This is the most important strategic issue that the cable network should discuss in the past decade. The latter obviously requires small investment, quick results, and sufficient control, but in fact, only businesses with large investment and slow results have real core competitiveness. Because in the long run, the core competitiveness of network operators must come from the network, not a certain value-added service that is ultimately proven to be a pipe dream. The loss of the cable network in the past 10 years is that it focuses on the latter and is unwilling to socialize the business in the form of SP. This directly results in the absence of a virtual business operator in the field of cable networks, and ultimately the inability to successfully build a network highway. In contrast, China Telecom and China Unicom only focus on basic applications such as voice and SMS for self-operation, and other applications are all in the form of SPs. Win-win cooperation with social resources, not only has made some SPs and virtual operators, but also because of focusing on basic network construction, it has won the actual monopoly of the network highway.

But for cable networks, it is still not too late to mend the situation, because:

First, cable networks still have a monopoly on TV screens, and in the medium term, DVB+OTT is the trend. OTT is not Tang Monk's meat. Not everyone who eats it can live forever. Some people will have indigestion. Because it meets the two most basic human video needs, live broadcast and on-demand, at the lowest cost and with the best experience. Therefore, cable networks should embrace DVB+OTT with an open mind and give up VOD, which still looks beautiful now and is a pity to throw away. Think about how regrettable it is for China Telecom and China Unicom to give up 3G and embrace 4G.

Second, increase the two-way network transformation and broadband access services. This is a strategic investment that can be "capitalized" into the balance sheet of the cable network development strategy. Because in the long run, there will only be an IP-based Internet, and all industries will be Internet-based. Cable networks without two-way networks will inevitably be marginalized. Now it is still DVB+OTT, and in the future it will be OTT+DVB.

In this regard, there are already some successful cases that can be used as reference. The first one is Shenzhen Tianwei Cable. In the years of fighting with Shenzhen Telecom, it has not only not been subverted but has thrived. At present, half of Tianwei's revenue comes from non-traditional TV business. The second one is Dr. Peng. After the backdoor listing, it spent 2 billion to acquire Great Wall Broadband and focused on broadband network construction. At present, it has a market value of nearly 30 billion. It and China Mobile, which merged with Tietong, have become the fourth and third largest broadband operators in China respectively. Looking back 10 years ago, we foresaw that the third largest broadband operator in China should be these cable companies in China. Now it seems a pity. In addition, every profession has its own specialty. Operators must admit that it is impossible to give birth to the greatest OTT business within the operator system, just like the largest OTT business is Tencent's QQ and WeChat, and it cannot be China Mobile's Fetion and China Telecom's YiXin.

But I am still optimistic about operating cable networks and TV screens. They still have the cost-effectiveness of live broadcasting, tree-like networks, and mature scale monopoly operation models that are incomparable to video websites and telecom operators (for example, TV programs have to pay landing fees when they land on cable networks, but they can charge program fees on telecom networks. This seems to be a completely opposite business model, but it is not just a policy advantage, but also a monopoly scale advantage). The DVB+OTT model, which has made a gorgeous shift from value-added services to basic network construction and broadband access and operates value-added services with an open mind in cooperation with external resources, is the future of cable networks that we can look forward to!

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.