In a deal with huge ramifications in the race to provide online TV, Japanese technology manufacturer Sony (SNE) and media conglomerate Viacom (VIA) have reached a tentative agreement to stream the network's major channels, including MTV and Comedy Central, onto tens of millions of PlayStation 4 consoles.
Analysts are saying this is far from a death-blow to traditional television service, which is still a mainstay among older subscribers. Viacom's content, which also includes Spike and Nickelodeon, is vastly more popular among younger viewers anyway. The company has been by far the most aggressive in making its programming available on other digital video services, such as Netflix (NFLX) and Amazon (AMZN), according to the Wall Street Journal.
Other issues need to be worked out. For instance, Sony will likely need to seek out other deals if it expects to compete with traditional TV - the dozen or so channels Viacom brings to the table aren't going to cut it. And besides, the widely available PlayStation 3 model ranks third in sales to Microsoft's (MSFT) Xbox and Nintendo's (OTC:NTDOY) Wii. There are purportedly talks under way with Disney (DIS) and Time Warner (TWX), but content channels are likely to charge extra when working with an unproven medium. In the event that the PlayStation 4 flops - the companies involved would want some sort of revenue guarantees.
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1.Sony Corporation (SNE, Earnings, Analysts, Financials):Designs, develops, manufactures, and sells electronic equipment, instruments, and devices for consumer, professional, and industrial markets worldwide. Market cap at $20.22B, most recent closing price at $20.0.
2.Viacom Inc (VIA, Earnings, Analysts, Financials):Operates as an entertainment content company in the United States and internationally. Market cap at $37.11B, most recent close at $78.63.
(List compiled by James Dennin. All financial data sourced from Finviz.)
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