What started out as friendship has grown stronger. REO Speedwagon said that first, but they were singing about eternal love between two people. They could have been talking about people who sampled cutting the cord and now couldn’t be drawn back into satellite and cable TV with candy and flowers. The cut the cord movement is taking thousands of customers from cable and satellite every day and is not slowing. Today, Money Examiners looks at the reasons why and the future of television as we see it. What is certain? Change and upheaval. Who will benefit? Hopefully, the viewing public.
The TV industry lost over a million traditional subscribers between July and September of this year, for a loss total of 90+ million subscribers since the first customer said, “I wonder if I could stream this?” The Kagan Research Group provided those numbers.
The declining number of traditional TV service subscriptions comes in concert with the plethora of new Internet-streaming services. Sling, Google’s YouTube TV, and Hulu are the biggest, but DirecTV Now and PlayStation Vue are also players in this tournament. The streaming services used to offer warmed-over “On Demand” reruns, but they have stepped their game up in a big way. They now include local and national broadcasting networks along with sports channels. There is little wonder that many paid television subscribers are dumping the box and switching to the online equivalents.
Since July 1, broadcast satellite providers lost more than 750,000 subscribers. Kagan Research described the hit to the traditional providers as “their worst quarter on record.”
Additionally, almost 95,000 subscribers dropped their combination television/cell phone packages. Verizon took the biggest hit, losing about 64,000 subscribers.
As far as cable television is concerned, Kagan Research counted the losses from the beginning of this calendar year. Over that long period of time, the cable guy lost about 1.05 million subscribers. That’s the worst performance in over four years. It’s a signal that the flood is only beginning to take its toll.
In response, traditional broadcast networks (like ESPN) are attempting a new tactic. They are debuting proprietary paid subscription plans. Even Disney, who some believed was immune to these kinds of things, is introducing a streaming service sometime in 2019.
The Kagan Research report is bad news for traditional TV providers, but it isn’t the first such report the industry has heard. It follows an eMarketer forecast estimating that 51 million people are expected to forego satellite and cable subscriptions. Newer, cheaper, and at least as good television subscriptions from YouTube TV and Sling are the biggest reason for this drop.
Researchers have made a note of the migration and found that some of the new streaming services are indeed cheaper than conventional TV. Research firm cg42 reported that cord cutters pay an average of $118 per month for their television package, but traditional subscribers pay about $203 monthly for subscriptions.
For years, cable and satellite subscribers felt like a change. Now, they don’t have to fight that feeling anymore.
Who knew that REO Speedwagon saw into the future of television so clearly? It is almost eerie.