distribution network

Entire chain of distribution intermediaries from the supplier to the consumer. A strong and efficient distribution network is one of the most important assets a manufacturer can have, and is the biggest deterrent that faces the new competitors.

I'm convinced television programming is going to go over the Internet, an open system that's the most efficient distribution network ever created. Everybody will be selling broadband access as a commodity. In such a world, a cable or satellite company packaging channels with some choice but not much and charging you 40% off the top is insane. At the end of the day, the cable company is the middleman. In a digital world, middlemen margins get crushed, because the marginal cost of transmitting a bit of information is zero. If you're a middle man with a closed architecture, you're in trouble. You might not feel it in 2006 or even 2008, but longer term you're doomed.