• Marketwatch, Wednesday, March 21, 2007 10:45 AM

Will content distribution be a bigger business than media or hardware? Where market capitalization is the measure, content will always be king--just look at Google's $140 billion valuation versus ISPs. They "risk becoming dumb pipes, unless they offer something exclusive or compelling." Does that mean they should seek out partnerships with YouTube and MySpace? Time Warner Cable's Mike Roudi, vice president of wireless, doesn't think so. These marketing deals aren't game changers, network upgrades are.

Meanwhile, voice, television, Internet and wireless services providers face subscriber defection unless they agree to offer competitors' services. As a result, media distribution has seen some unlikely alliances, such as Time Warner Cable and Sprint Nextel, competitors in the VoIP and ISP businesses. Almost all distributors these days offer triple-play bundles: voice, ISP and TV service. Quadruple-play, usually the result of an alliance, is the addition of mobile wireless as a fourth service. Here you can expect to see more consolidation, as consumers demand that media distribution become more centralized.

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