Cable television subscriptions take a major tumble
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By Catholic Online (NEWS CONSORTIUM)
3/20/2014 (5 years ago)
Catholic Online (https://www.catholic.org)
I recent statistics hold true, the era of the U.S. pay-television market is past its prime. The number of Americans who pay for TV through cable, satellite or fiber services fell by more than a quarter of a million in 2013. If this trend continues, 2012 may have been the industry's high point.
With all due respect, there may be another factor behind pay-TV's decline. Read the final paragraph.
LOS ANGELES, CA (Catholic Online) - People are remaining glued to their set, however. Online-streaming services from Netflix and Amazon.com are drawing viewers in record amounts.
Original, content-specific series such as "House of Cards" has appealed to consumers and these services charge as little as $10 a month. Fewer people are willing to shell out $40 a month for a wider menu of cable channels.
The falloff of subscribers isn't huge, but points to a trend. Video subscribers across the entire pay-TV industry, which includes Comcast Corporation, DirecTV and Verizon Communications Inc., dropped by 251,000 last year to about 100 million.
In was something that was in the cards. Research firm IHS said in August that TV subscriptions would decline to 100.8 million from 100.9 million in 2013. Cable companies have been suffering declines for years as satellite and phone carriers wrested away market share.
DirecTV, Verizon and their ilk still gained TV subscribers last year, but it wasn't enough to make up for two million lost cable subscribers.
More people are watching video on tablets and Smartphones, and cable TV is reacting to this trend. They're investing to boost Internet speeds as broadband services become more popular, often at the expense of TV subscriptions.
As more consumers sign on to streaming offerings such as Netflix, Internet speeds have become important when choosing a broadband provider. Companies like Time Warner Cable Inc. have seen competition from telecommunications services like Verizon, which touts its fiber-optic technology and higher speeds.
Seeing the handwriting on the wall, Comcast struck a deal last month with Netflix to grant the streaming-video company more dependable delivery of shows and movies for an undisclosed price. Comcast could continue to be a middleman between viewers and video creators.
The company is also seeking regulatory approval for its $45 billion acquisition of Time Warner Cable, giving it more subscribers to increase its influence over cable networks in fee negotiations.
The industry-wide drop last year in video subscriptions suggests there's a limit to what Americans are willing to pay. The biggest channel to pay-TV channels is the fact that a new generation of young adults hasn't gotten into the habit of paying for video.
"The market's decline can be traced in part to the growing number of so-called 'cord-nevers' -- those who object to ever having a pay-TV subscription," IHS said in August. "Equally as important, the price of a typical pay-TV subscription remains high, staying well out of reach for a number of consumers."
With all due respect, there may be another factor behind pay-TV's decline. Four-hundred plus channels equals far more TV commercials. Users are essentially laying out a major monthly stipend in order to watch EVEN MORE adverts touting products they don't need! A sunny day at the nearby park never seemed more inviting --
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