Meta's Muse Read-Through for Cable, Telecoms not as Bad as Feared

1428 ET - The sour market sentiment toward cable and telecommunications stocks following the release of Meta's Muse AI agent is likely overblown, Morgan Stanley analysts write in a note, writing that investors have "not been discerning enough in assessing the risks posed by the rise of agents." Yes, the ease with which consumers can use AI agents to manage their bills and subscriptions is notable, but the pricing pressure on cable and telecom names may be less than the market is expecting. "Agents should lower search and switching costs, improve consumers' ability to identify better offers and potentially increase pressure on acquisition costs, retention spending and ARPU," the analysts write. "But the magnitude and source of that pressure could vary considerably by provider and product." They see cable names as more exposed than wireless stocks.