backtop


Print

Cable subscriptions are poised to drop below 40 million for the first time in over a decade

As Americans prepare to give thanks this year, there will be a lot less watching the big sports games and parades on TV than there were in previous years.  Indeed, subscriptions to major cable firms set to hit 40 million this year -- the lowest level in over a decade.
 
I. RIP Cable?
 
The ISI Group is the latest market research firm to note what appears to be the slow death of the cable line.
 
In a Business Insider summary, top research firm eMarketer reports that between 2009 and 2013, the amount of time Americans spend on TV (versus other forms of media) dropped from 45 percent to 38 percent.  Meanwhile mobile -- including mobile video -- exploded from 4 percent to 20 percent.

Media consumption
Mobile media consumption is exploding. [Image Source: Business Insider]

To be fair, the same survey shows that mobile is also cannibalizing the haggard holdouts of the print and radio world, businesses already weary from weathering the dot com explosion of the 90s.

Cable subscriptions
Cable subscriptions are on the verge of falling below for 40 million for the first time in a long time.
[Image Source: Business Insider]

Online media continues to be a persistent threat to cable TV, radio, and print.  But it appears that what makes mobile really dangerous is that its used the most at a time when people typically don't consume content on their PC -- late at night.  In the 1990s late night was an entrenched point on which traditional media could stake its defense against online competition.  And it was true, after a long day in front of their PCs consumers tended to turn on their TVs.  In the mornings they might flip open a newspaper or turn on the radio.
 
Part of this was simple logistics -- computers take a little work to get up and running and require more interaction.  By contrast the TV is always sitting ready in your home (if you own one) and the radio is always sitting ready in your car.
 
But with mobile devices you can get instant, easy access anywhere -- on your sofa at home, at your breakfast table -- yes, even in your car (but don't do that!).  Due to this trend, traditional media has taken to referring to mobile media as "vampire" media -- not just because it's sucking away their lifeblood, but also because it emerges most prominently in the evening and the wee hours of the morning.

Samsung TV
Some fear TV just isn't as sexy an evening time-sucker as it used to be. [Image Source: Flickr]

Of course, the root issue here is that traditional media itself had become a creature of the night, but mobile is proving itself to be the more seductive time-sucker.
 
II. A Revolution Has Begun
 
Yet there are at least some rays of hope for cable TV.  Cable viewership -- including viewership of big events like championship sports games -- is falling slowly and steadily, but revenue from those events is actually up.  This is because while consumer demand is slowly weakening, advertiser demand for big events is strengthening fast.

Cable supply and demand
Demand for cable advertising eyeballs is rising faster than the supply is falling.
[Image Source: Business Insider]

The flip side of the traditional internet and mobile internet market is that advertisers are coming to appreciate the value of traditional content more -- if perhaps too late to save it in the long run.  Some tech-savvy customers block online advertisements, but studies have shown even when ads are viewed, they often produce weaker results than with television.
 
Perhaps part of the problem is that the internet has made us impatient.  Cable TV made us accustomed to sitting through anywhere from 3 to 6 ads, just to get 10 to 15 minutes of actual content.  By contrast, internet has spoiled us.  It has addicted us to instant content.  
 
Even having to sit through one ad on popular video services such as Google Inc.'s (GOOG) YouTube is so "unbearable" to the internet's users that Google was forced to ad the option of skipping the rest of the commercial early -- weakening its own advertising punch.  And if traditional internet returns on advertising investments were disappointing, mobile ads in many cases were even worse -- as the flight of high-profile clients from Apple, Inc.'s (AAPL) iAd service has shown.

Mobile Ads
Mobile ads reach huge userbases on Android and iOS, and yet they're often relatively ineffective compared to traditional ads targeted at much smaller groups of users. [Image Source: Google]

And there is a bit of resurgence in one corner of the declining cable market.  Mobile companies -- namely AT&T, Inc. (T) and Verizon, Inc. (VZ) -- are actually adding viewers as traditional powers like Comcast Corp. (CMCSA) and Time Warner Cable Inc. (TWC) subscriptions fall.  Interestingly, DIRECTV (DTV) and Dish Network Corp. (DISH) -- the top two satellite TV services -- are also adding customers.

Cable TV
TV is dying... pay no attention to all the growing cable providers. [Image Source: Business Insider]

One thing we haven't seen fully noted elsewhere is that Verizon and AT&T are winning customers by simply using better, more modern cable boxes.  Comcast's Xfinity cable TV interface looks like a somewhat of a Geocities-era bright, boxy, garish dinosaur of a UI versus the sleeker, more response UI encountered with Uverse.  On some boxes, Xfinity looks so awful and crawl so slow, it simply is simply an undesirable option for a digital age consumer, regardless of the service quality otherwise.

Uverse guide
Uverse has a slick, modern guide UI [Image Source: AT&T]

Xfinity Guide
Xfinity's guide on its most common boxes is an ugly dinosaur of sorts -- with a garrish palette, slow responses, and painful navigation, compared to Uverse. [Image Source: Snapguide]

Looking at this we have to ask ourselves if cable has ever been truly as alive as mobile devices in terms of fast, vibrant access to content.  It seems like the era of modern cable has only just begun.  Its evolution is coming.  The revolution has begun.
 
Studies have shown that the number of households with a TV is dropping in America -- but it's occurring so slowly that it may be a simple adjustment to shifting TV prices.  Rather than showing that cable is dinosaur doomed to a slow death in decades to come, companies like Verizon and AT&T are showing that maybe all it takes to save cable is some mobile-age business acumen.  Verizon and AT&T are finding that by offering their mobile users extra perks for subscribing to digital cable (e.g. free on-demand sports content), they can actually rekindle consumer interest.
 
The Business Insider report on these trends is entitled "TV Is Dying, And Here Are The Stats That Prove It".  But the irony is that by showing the rising demand for cable advertising, and the growth of mobile-savvy cable businesses it actually has unwittingly made a case for why cable TV can survive in a digital age.

Video Killed the Radio Star
Video forced the radio star to go digital, more aptly.  Cable TV is seeing a similar evolution. [Image Source: ABC]

Mobile media is killing TV.  It's forcing TV to evolve.  Cable's aging powers will of course go the way of the dinosaur.  But just like satellite radio gave new teeth to an old media form in a digital age, some are offering up fresh formats for cable TV.  The old guard's losses will be the gains of these new rising stars who are making TV cheaper, bigger, better, faster, [and] stronger.

Evolve or perish.

Sources: Business Insider, eMarketer





"Game reviewers fought each other to write the most glowing coverage possible for the powerhouse Sony, MS systems. Reviewers flipped coins to see who would review the Nintendo Wii. The losers got stuck with the job." -- Andy Marken







Latest Blog Posts
The Best Android Apps
Saimin Nidarson - May 20, 2017, 6:16 AM






botimage
Copyright 2017 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki