Time Warner Cable (NYSE:TWC) has announced that it will introduce its live TV streaming app in a few weeks for Google’s (NASDAQ:GOOG) Android-based devices that are running its latest version.  This app is already available on Apple’s (NASDAQ:AAPL) iPhone and iPad. The company is waking up to the call by consumers for flexible access to programming and increased Internet-based viewing.
We earlier wrote on how Time Warner Cable is speeding up its streaming initiatives, taking cues from the overall pay-TV industry that is headed in this direction (see Time Warner Cable Finally Picks Up the Pace on Streaming Offerings).
The Significance Of Streaming
We have stated previously that streaming is quickly becoming an important service enhancement that no pay-TV provider in the U.S. can afford to ignore. With smartphones and tablet sales on the rise, viewers are spending a significant portion of their time on these handheld devices. Naturally, the pay-TV companies need a share of consumer viewing in order to survive and hence it becomes imperative to provide streaming capabilities. Both live and on-demand programming will be key to consumer satisfaction. Netflix (NASDAQ:NFLX) has made a fortune riding on this online video streaming trend.
Time Warner Cable is primarily catering to demand for live programming streaming as far as these apps are concerned. But at some point, it will need to think about offering a Netflix-like service, or perhaps partner with Netflix to leverage the appeal of combined package and cross-marketing opportunities. The rest of its competitors including Comcast seem to be ahead in that sense.
The company has been suffering market share loss for quite some time and service enhancements such as online streaming will help improve that trend. You can modify our forecast above to see how a change in pay-TV market share can affect Time Warner Cable’s stock.
Our price estimate for Time Warner Cable stands at $65.67, implying a discount of about 20% to the current market price.Notes:
- TWC TV With Live Video Coming To Android Devices Soon, twcableuntangled.com, Apr 5 2012 [↩]