AT&T’s proposed $85.4 billion deal to buy Time Warner is the latest and largest mega-media merger. It won’t be the last.

Here’s why: AT&T andVerizon make their money giving customers high-speed Internet service at home, pay TV channels and, in some cases, Internet access to mobile devices.

The shorthand labels for these services are broadband, cable and wireless.

These are GREAT businesses. Demand for their services has been growing for years. But they’re not what customers actually want. They only provide access to what people want.

Broadband and wireless remain strong and growing businesses, although their growth will slow when they reach saturation of their markets – that is, when pretty much everyone who can afford broadband and wireless has it.

But cable has exhibited strong growth, as viewers’ desire for movies, shows, sports, news and other video content is insatiable – and cable is able to meet that demand with more channels, including premium channels, and pay-per-view offerings.

Yet there is a dark cloud lurking over the cable industry, in the form of a question that haunts cable executives like a waking nightmare: what if consumers could get access to all this great video content, in the comfort of their own home, without cable?

And that’s exactly what’s starting to happen.

Drinking at Home

Imagine a law that says you can only drink liquor in a bar. AT&T, Verizon, Comcast and other such companies are like bar owners in that scenario. They’re making money hand over fist because they own the only way to access what people want.

Now imagine the law is changing to allow people to buy liquor in stores and drink it at home. What would those bar owners do?

They’d try to own the liquor, right? That way they can get paid no matter where people choose to drink.

The fact is, there’s now compelling competition for pay TV, in the form of online video services. If you can watch your favorite shows online whenever you want, and stream live events such as sports and breaking news, why do you need pay TV at all?

That’s why cable providers need to own content. That way they get paid no matter how you watch it.

Comcast recognized this several years ago and snatched up NBC-Universal (and, this year, DreamWorks Animation). Now AT&T wants to do the same with Time Warner.

Verizon has chosen a different path so far, acquiring AOL and Yahoo! to boost market share in online and mobile advertising (another way to profit from people watching video in new ways). They’re also created Go90, a mobile video service that captures some of the emerging market for non-cable video. But I wouldn’t be shocked to see cash-rich Verizon looking to buy more content providers over the next few years.

So if as investors we want to own the liquor, not just the bar, we need to focus on content providers who know how to attract viewers. In recent years, that’s been companies like Time Warner, Disney, YouTube, Netflix, Amazon Prime – and many other small players who may be acquisition targets.

Netflix (Nasdaq: NFLX), for example, has a market cap right around $55 billion – similar to Time Warner’s market cap of $61 billion before the AT&T deal was proposed. The stock is expensive right now, thanks to a 20% run-up after announcing better-than-expected earnings last week.

But it’s made smart moves to become a creator of original content, including hit shows such as “House of Cards” and “Stranger Things.” And it’s a go-to source for movies, documentaries, old TV shows and other licensed content.

You better believe someone at Verizon is spending a lot of time looking at Netflix right now.

After all, that’s what consumers are doing.