Why break this golden cable/satellite model? It's so profitable for the content providers and, while there's a petty dispute here and there over fees, the cable and satellite companies aren't complaining that much.
Jeff Bewkes, the CEO at Time Warner, has the right idea with HBO GO. First, he refuses to open it up to people who do not subscribe traditionally to HBO. Second, and this is the extra important part, he's doing a (very good) digital offering through his own platform. Time Warner sets itself up to be as big a digital/mobile powerhouse as it is an old guard media one now.
But Disney chooses to give the reigns to Netflix. That doesn't make me as bullish as I normally am on this company and, over the long-term, the stock.
I feel like I have a decent handle on what they're doing at TWX/HBO. I would expect Disney to do the same or something similar, particularly after it took ESPN digital much the same way Time Warner did HBO.Build a digital powerhouse. Take as much of your content inside as you can. Broadcast via your own platforms. And then sell the non-exclusive scraps to Netflix, Amazon and others, who will likely be more than willing to overpay for it. Why bust the model open prematurely? And then when you have to bust it open, do it on your own, extending your presence as a creator and distributor of content. I must be missing something. Or Disney made a really bad mistake. I would love to hear Jeff Bewkes' take on Disney selling the business out to Netflix. Follow @rocco_thestreet --Written by Rocco Pendola in Santa Monica, Calif.