Valuation "Envy" and Importance of Content Businesses for Telcos
Some executives might be forgiven a bit of envy where it comes to valuations. Access providers might envy the higher valuations of media properties, while media executives might envy the valuations given to technology firms.
Among the reasons for the difference in valuations is scarcity. Technology firms often create uniqueness hard to replicate, while media firms do so with exclusive content.
That explains why most major video suppliers try to acquire exclusive rights to some content. At the same time, that also means the value of bundles will remain substantially intact. If content is fragmented, then aggregating content will generally create value.
The point is that video entertainment, and all content businesses, are valued differently than “access” businesses that more or less sell “commodity” network access.