On the surface it just looks like more bickering between a cable television company and the owner of a cable channel. The impasse cable giant Comcast (NASDAQ:CMCSA) is presently grappling with, however, is a bit unusual. That's because the company's Xfinity cable brand has yet to come to pricing terms with NBC, which is also owned by Comcast.

You read that right: One Comcast unit is struggling to strike a deal with another Comcast unit.

Even investors without a stake in Comcast will want to keep close tabs on the story, since it could potentially affect all cable names and content creators.

A cable TV Catch-22

Comcast's Xfinity cable service recently disclosed a list of channels that may soon be leaving customers' lineups. The warning reads "It is possible that contracts for the channels listed below will not be renewed, in which case Comcast would no longer have the right to carry those channels on our systems."  The list of channels potentially being removed includes CNBC, MSNBC, several regional NBC Sports channels, Bravo, Syfy, USA, and a few others owned by Comcast's NBCUniversal division.

It's not as crazy as it may seem on the surface.

Multiple digital television screens in motion.

Image source: Getty Images.

The Department of Justice may have permitted NBC and Comcast to merge back in 2011, but the deal wasn't without conditions. The Federal Communications Commission (FCC) insisted that NBCUniversal continue to supply rival cable services with video entertainment content at "fair market value and non-discriminatory prices." That's why NBC must be very careful about what it charges Xfinity for the right to distribute its content. While the FCC doesn't regulate pricing, if it appears NBC has offered its parent a price break, competing cable companies like Charter (NASDAQ:CHTR) and AT&T (NYSE:T) could more than reasonably argue they should be allowed to pay the same price for the same programming.  

As it stands now, only two major telco names are in the unique positing of owning content-creation businesses as well as a means of distributing this video entertainment. One is the aforementioned Comcast. The other is AT&T, which owns television and movie brand WarnerMedia, streaming cable service AT&T TV Now, streaming newcomer HBO Max, and (for the time being) satellite cable company DirecTV. If Comcast's standoff with itself puts the matter directly in front of the FCC, AT&T's situation could just as easily be scrutinized.

Indeed, AMC Networks recently filed a complaint with the Federal Communications Commission against AT&T along these very lines, suggesting AT&T's cable units were unfairly favoring the company's own media brands by under compensating AMC for its content. AMC eventually withdrew the complaint rather than risk losing revenue by severing ties with AT&T as a distribution partner. The fact that it was filed in the first place, however, makes it clear these conflicts of interest are now being questioned. If more such filings are made, the FCC could simply require price uniformity, complete transparency, and universal availability rather than attempt to handle a string of pricing complaints.  

The continued proliferation of streaming services will only exacerbate these conflicts of interest.

Winners and losers

It may seem likes cable players such as Charter and Comcast's Xfinity are in control. After all, despite the steady cadence of cord-cutting they still bring on the order of 80 million U.S. paying households to the table that many channel owners wouldn't be able to monetize.

It's actually the studios and content creators enjoying the upper hand here, however, thanks to the ongoing normalization of digital video.

Streaming services ranging from on-demand platform Netflix to digital-only cable packages like fuboTV (NYSE:FUBO), to hybrids of the two such as Hulu+Live from Walt Disney offer consumers more entertainment choice than they've ever had. Industry research company Parks Associates estimates there are nearly 300 streaming services available in the United States alone. This superficially sets the stage for more -- not less -- competition, but in reality consumers are using this degree of choice to custom-build their video entertainment packages with several of these offerings. Leichtman Research Group reported last month that nearly 80% of households subscribe to at least one streaming service, while more than half use more than one. Ampere Analysis says U.S. households could eventually make room for as many as eight streaming services.

Conversely, eMarketer estimates more than one-third of U.S. households won't subscribe to traditional cable by 2024, with the nation's number of cord cutters projected to rise from 31 million this year to nearly 47 million then.

A slowly sinking ship and a life raft 

In other words, cable television is still a slowly sinking ship. Streaming is the life raft. There's going to be a rough transition period as we shift away from the former and toward the latter. During this time some film and TV studios might have to make tough choices about selling content to other distributors. Comcast already has, in fact. New streaming service Peacock offers some programming that's not even available via NBC's broadcast. It's a subtle but perhaps telling decision.

This dynamic, of course, underscores the importance of owning multiple distribution platforms as well as multiple video services to distribute, just to be able to handle the unknowns of the future. In this vein, Comcast just announced it lost another 273,000 video customers last quarter, but added 633,000 broadband internet subscribers. It also reports around 22 million Peacock users since its mid-July launch, and its free, ad-supported Xumo regularly serves 24 million viewers.

Also in this vein: While the FCC Chairman Ajit Pai's current view that everyone's better off with overbearing regulation of the streaming business, that stance isn't set in stone. The industry as a whole would be wise to police itself, rather than run the risk of forcing the agency to act.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.