Analyst Moffett Sees 2017 Bringing Possibly Numerous Upsides for MVPDs,
Most multichannel video programming distributor stocks outperformed the market in recent years, but there's still reason to believe they're undervalued and will continue to do well in 2017, given expectations of lower taxes, less regulation and lower capital intensity, MoffettNathanson…
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analyst Craig Moffett wrote investors Thursday. He said Communications Act Title II reclassification of broadband was, at its core, setting the stage for broadband price regulation eventually, and the reversal of reclassification under a GOP FCC and deregulatory White House "is a matter of when, not if." That reclassification reversal probably would preserve net neutrality principles while taking away Title II as the administrative means, he said. It also could open the door to bigger charges for interconnection and to usage-based pricing, he said. Moffett also said the rise of over-the-top video and app-centric video consumption will mean less capital spending on set-top boxes. Conversely, he said, the biggest MVPD challenge in 2017 is 5G, even though deployment will take years. OTT is a somewhat lesser concern, though Hulu and maybe Google likely will launch OTT offerings in 2017, Moffett said. Comcast is expected to launch its wireless service in mid-2017, but cable's entry "will be a slow gradual process," the analyst emailed investors.