Future of Media Beat: Cable is “cash-rich, but future-poor.”

Comcast has actually described itself as “cash rich, but future poor.”

Cable’s business model is indeed a machine for printing money, which leads me to believe that it will always be profitable despite the rise of internet video. The question is simply how profitable.

As Marshall McLuhan observed, new media never totally replace old media. They are simply added to the mix. For example: the market for ebooks has fallen a bit in the last few years while the market for print books has actually risen. The relationship between those two media seems to be stabilizing, despite predictions that one would eat the other. To look at a larger time scale, print has never recovered from the blow dealt to it by radio and live TV. But as the bustling Frankfurt book fair opening last week shows, print is not going anywhere, probably ever.

So for forms of media, the important question is never survival, but dominance.

We have this massive infrastructure of wires and satellites that deliver cable TV. We’re not going to stop using it. Comcast just forked over $40 billion to purchase Sky, a satellite TV network, even thought satellite TV is in decline, too. Why? Because cornering the market in a multi-deca-billion dollar business, even in decline, is still obscenely profitable. But by purchasing Sky, Comcast does seem to be doubling down on the obsolescing media market rather than entering the fray for the future of internet video.

The only people who seem to have the stomach for that are the FANGs (Facebook, Amazon, Netflix, and Google), and the indomitable Disney, which always seems to be both cash-rich and future-rich.

There is no question that the dominant medium of the future will be internet video. In creating the iPod, Steve Jobs was actually trying to create a market for what he called “portable video,” as early as 2005. Disney is just catching up to that realization over a decade later, but with a massive global audience of deeply committed fans and the best reservoir of content, their fortunes look good.

Whoever has their hand on the master switch of the dominant medium gets to make all the money in the future, and my bet is on the Mouse.