The $150 billion a year pay-television market has an understandable lure for Google. A venture into the television market offers a way to expand into pay video and telephone services and has the potential to turn advertising and distribution on its head.
"This would put Google in a position where it could not only sell subscriptions to the pay TV channels, but sell ads on those channels as well. It would also put its video-on-demand services in a sweet spot, perhaps moving many of its video capabilities over to the streaming-video Internet side, rather than the conventional cable TV business model," writes Charlie White of Mashable.com.
The company has already announced plans to build a fiber-optic high-speed Internet service in Kansas City, Missouri and Kansas City, Kansas. Could this be the first step?
White adds, "Google might even be able to turn YouTube into a sort of 'virtual cable TV,' where customers could pick and choose the programs they want, and it might be available on a national, or even international scale."
So, which cable TV stocks could be in trouble?
For ideas, we collected data on short floats, and identified a list of cable TV stocks being targeted by short-sellers. In other words, short-sellers think these companies are in trouble.
Do you agree with the bearish opinion on these stocks? Use this list as a starting point for your own analysis.
List sorted by short float. (Click here to access free, interactive tools to analyze these ideas.)
List compiled by Eben Esterhuizen, CFA:
1. Crown Media Holdings
3. Virgin Media
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Eben Esterhuizen and Rebecca Lipman do not own any of the shares mentioned above.
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