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Television

Will the Pandemic Finally Kill Cable TV? (barrons.com) 87

Posted by EditorDavid from the paying-for-TV dept.
In just the first three months of 2020, cable broadcasting's so-called "Pay TV" services have already lost 1.7 million paying subscribers, reports Variety: Comparing the losses against Q1 2019 paints a grim picture for most providers, but especially for AT&T, who lost a massive 3.6 million video customers in a year. Comcast has the second highest losses, down by 900k, with Dish down 600k and Charter losing 400,000 customers versus Q1 2019.... [R]ecall that COVID-19 only began to hit the country in a big way in the last 2-3 weeks of Q1. If Coronavirus is to blame for the declines, then Q2 will be appalling, with the industry well on track to meet Variety Intelligence Platform's estimate of 8 million subscribers lost across 2020.
While the 1.7 million cancellations represents just 2.3% of the 72.1 million paying subscribers that cable TV services had enjoyed at the start of the year, satellite TV witnessed a higher 14.3% drop in paying subscribers in just those same three months, according to Broadcasting & Cable. In the same article Craig Moffett of MoffettNathanson Research predicts "With sports off the air, and with the pain of the tsunami of unemployment just beginning to hit as the quarter ended, all these numbers will get worse in Q2." He also notes that YouTube TV and Sling TV lost 341,000 subscribers in the same 13 weeks, while subscriber numbers also dropped at AT&T Now and fubo.

Barron's says Moffett extrapolated the trends to a grim conclusion: Moffett adds that while it is a little early to declare the cable sector dead, he says it isn't actually too early to draft the industry's obituary.

So he wrote one: "The cable network business, once among the world's most profitable industries, succumbed today after a long and painful slide into irrelevance ...When the coronavirus crisis hit in early 2020, sports went off the air, and that was the beginning of the end. By the time sports came back, the damage had been done. The patient was unresponsive. The deceased is survived by Disney+ and Peacock. A shiva will be held over Zoom..."

Netflix, meanwhile, signed up more than 15 million new subscribers in the first quarter.
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Will the Pandemic Finally Kill Cable TV? More

Will the Pandemic Finally Kill Cable TV?

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  • Betteridge, like always.

    • Concur, with Betteridge. Offer some reasons too (Score:4, Insightful)

      by goombah99 ( 560566 ) on Sunday May 10, 2020 @03:15PM (#60045070)

      All the reasons cited in the article are transient and also work both ways.

      1. Hypothesis one: People only subscribe to cable because cable has exclusive rights to (most) sports programming. With covid, no sports so no cable wanted. Ergo, when covid ends people go back to cable.

      2. Hypothesis two. People are waking up the to the fact that most programming outside sports is available streamed. They may be suddenly registering this because of hypothesis 1. But no matter. Let's stipulate that's true and everyone knows it. In fact the cable companies know this too, none of the entertainment they offer is exclusive aside from sports. But wait... how come sports is exclusive? The cable companies don't produce sports programming-- they purchase it with exclusive rights. And in case you haven't noticed yet each week we see more programs dropping off general distribution directly from netflix and amazon and others and moving to exclusive content holding companies that pay for the rights to have that exclusively. e.g. HBO, showtime, etc... And it's perfectly possible that some cable company will contract for exlcusive access to HBO or Disney or whome ever. THey will have to pay more money than Disney and HBO can pull in by letting amazon resell their goods but that's what already happens with... sports.

      So no this isn't the death of cable unless the cable companies just decide to surrender or all entertainment becomes interchangable and theres no content you simply have to watch (Monday night football or the Game of Thrones)

      • Re:Concur, with Betteridge. Offer some reasons too (Score:5, Insightful)

        by Darinbob ( 1142669 ) on Sunday May 10, 2020 @03:57PM (#60045228)

        Hypothesis 3. Cable is ridiculously overpriced and people who are out of jobs are saving money. It is much easier to cut costs when income declines than to start spending again when the income resumes. Many people spend more on cable in a year than they will get from the recent stimulus checks (with authentic collectible signature). So when it's time to subscribe again, there will be some motivation to at least not spend as much, either going with bottom tier offerings, or hold off another month, or two, or three...

        • This. Cable is a "first off the top" for saving money for the middle class. Want to save money in your household starting tomorrow? The quick checklist is:
          1 - Don't eat out.
          2 - Cut cable.
          3 - Turn up the AC or turn down the heat.
          4 - Drive fewer places.
          5 - Cancel afterschool programs and gym memberships.

          Given that COVID pretty much covered (1), (4), and (5) you are seeing (2) and (3) pick up steam. In most households, this checklist saves $400+/month immediately ($6K/month in before-tax income).

          The next w

      • Re: (Score:2)

        by Kjella ( 173770 )

        But wait... how come sports is exclusive?

        Because cable companies want it to be, just like cinemas and first-run movies. They know abruptly switching to streaming would be very disruptive and actively block any hybrid solution so they can keep the market to themselves. If a large number of sports fans have already cancelled their cable because there's no sports that's an unique opportunity to reboot as a streaming service, either on their own or as part of an existing service. Unlike series and movies that constantly have to use cash cows to sell

      • Re: (Score:3, Insightful)

        by mrsam ( 12205 )

        There is another explanation. When people actually sit down and watch the boob tube, they're starting to wonder why they should be paying over a hundred a month for this crap.

        When you're busy working, and have a full time job, the cable bill is just another bill that comes once a month, you pay it on cruise control, without giving it much thought. True, you don't watch much of it. You're busy with your day job. But you figure that if you have a spare a moment or two you'll always find something good to watc

      • Re: (Score:3)

        by mark-t ( 151149 )

        People are waking up the to the fact that most programming outside sports is available streamed

        In general, I find this is simply not true without subscribing to several different streaming services that would collectively cost more than a cable bill anyways.

        • Amazon prime plus Netflix plus Hulu plus a streamed tv service (there are many to choose from) is way cheaper than what I'd get charged for TV from any cable provider. I get more content for a lot less with streaming. And unlike cable I can cancel anytime.

          • Re: (Score:2)

            by mark-t ( 151149 )
            I don't think that we watch a lot of TV, but between the shows that my wife watches and what I watch, I worked out that it would still cost more than $50/month for the different streaming services to cover most the programming that we do currently watch. $50/month is much less than my cable bill, but only because my cable bill includes a high speed internet subscription. I still need the internet package to stream in the first place, however, and If I cancelled only the TV portion of my cable subscripti
            • There is a difference even if the cost is roughly the same.

              TV content is crap. On streaming you can pick and choose which specialty or general content services you want.

              • Re: (Score:2)

                by mark-t ( 151149 )
                Perhaps you didn't catch that I said it was literally *cheaper* for me to buy a bundled internet package and cable subscription than it would be for me to have a high speed internet connection and separate subscriptions to half a dozen different streaming services, which, I might add, wouldn't actually even cover all of the shows that my wife and I happen to really like watching.
                • Oh, what I missed is that you actually -like- cable tv shows. I thought the only people with cable tv either are too busy or stuck in their ways to switch or took the minimal bundled package because it's $5 cheaper than the same internet without it. I didn't know anyone with a under deal actually watched it.

                  To each his own. Carry on.

                  • Re: (Score:2)

                    by mark-t ( 151149 )
                    It's less that I like cable tv shows than it is that I like shows which happen to conveniently be on cable tv, and the fact is that the programming we do watch in my place is both less convenient for streaming and more expensive if I were to get a good representation of the same programs.

        • Learn to binge watch. Subscribe to each app for one month out of the year and watch all the shows they made over the last year.

          • Re: (Score:2)

            by mark-t ( 151149 )

            I'm not knocking it if you want to do that, but the inconvenience factor that would come with switching streaming services every couple of months or so would not be worth my time, nor the hassle of reprogramming the smart TV each time so that it's always painless to access for the less technologically literate in my household.

            To be frank, the biggest reason why I don't switch to streaming however is that streaming doesn't even have options in Canada for some of the shows that we really like to watch anyw

        • Re: (Score:1)

          by codlong ( 534744 )
          I disagree. We cut DirecTV about a year and a half ago. My last bill was $189. I now get Hulu+, which actually DOES have the sports my wife likes to watch (via Fox, ESPN, CBS etc.), Amazon Prime and Netflix. Total cost $80. We do also have Disney+ and Apple TV. We got Disney+ free for a year through Verizon and Apple TV with my new iPad. But even if we kept all those we are still way shy of $189. Plus, my wife doesn't even count Prime, because she gets for free shipping, so it's a bonus.

          The only issue I h

    • I don't know if you can Betteridge this one. Cable TV really does deserve to die SOOOOO much. (But why am I unsurprised to find no mention in the discussion of CNN, the greatest killer of any actual value in cable TV?)

      In my usually perverse and time-centric way I see this as a battle between a surfeit of choice and a limited amount of time. The cable TV model was sick from birth, and Covid-19 is just the last straw. There's no sensible reason to pay to have lots and lots of channels when you only have one p

      • In fact, dual screen use is on the rise. Have you watched TV with a Millennial lately? Watching multiple things at once is becoming the norm.

        This is exacerbated by 24 hour cable news and sports. Many people just keep the TV on at all times. It's like their security blanket. But when they want to view content, they go to their laptop or phone.

        It's rather disgusting how we've let ourselves get roped in by this crap.

        Video killed intellectual discourse. It's well documented that our brains are wired to prioriti

        • Re: (Score:2)

          by shanen ( 462549 )

          Basically I have to express concurrence, but with sadness. Attempting to do two things at once insures that neither of them will be done well.

          Then I have to plead guilty. I often leave a video running on another computer, but I try to limit the behavior to low-value tasks such as filtering email or looking at my daily ration of comics. If you asked me later on what those videos were about, I could only answer in vague terms.

          • Re: (Score:1)

            by guruevi ( 827432 )

            There is a huge shift in how you consume content in this way though. Many people are no longer watching stuff to learn, but simply watching stuff to reference. This is a culture of "I heard x about z before, let me reference y to find out the facts"

            • Re: (Score:2)

              by shanen ( 462549 )

              Hmm... I'm having trouble linking that to the context of the economic (and other failures) of cable TV. I think you're actually going into the area of changing ways of remembering things. The classic distinction is between the things we know and carry around in our heads versus the things we only remember how to look up as needed. Some people only regard the first type as "real knowledge". Is that relevant to your position? Or can you clarify how you're linking it to the topic of the story? (I acknowledge t

    • Comment removed based on user account deletion
  • Always has been when people are out of work. Whether its cable tv or netflix... we got better things to do.

    • Huh. I think you give people's budgeting skills and rational decision making too much credit. If my many years of landlordship are any indication, cable TV and alcohol are among the last things people will drop from their budgets. Well after keeping a roof over their heads, in a few occasions.

  • Why no report of percentage loss at the streaming services?
    Netflix was added to Comcast's higher plans recently... is that the growth?
    Also lost, offices that were viewing CNBC... they'll be back later.

    This story is not news when reported this way. This isn't about Comcast, it's about the shift due to COVID-19. It'll all be back soon enough.

  • Cable TV is the new AOL (Score:3)

    by guacamole ( 24270 ) on Sunday May 10, 2020 @03:08PM (#60045040)

    Even though the cable TV providers saw the writing on the wall many years ago, they failed to adapt to the new times. It is now year 2020 and the cable is starting too look like a dinosaur. Failure to provide a la carte programming, still no 4K broadcast, and raising the prices.

    It seems like somebody at the very top already made the decision to stop investing in cable TV and simply continue milking the shrinking base of existing customers, many of whome have become too used to their not-so-cheap dvr box and way of doing things to become cable cutters.

    • Re: (Score:2)

      by kenh ( 9056 )

      IHonestly, a big driver is ESPN - they get a cut of almost every cable bill to provide premium sports channels on cable networks.

      Cable providers include it in nearly every bundle, due to contract obligations that make per-subscriber rates cheaper when the number of subscribers goes up. Typically, only the most-basic cable plans avoid the ESPN tax.

      • Re: (Score:2)

        by vlad30 ( 44644 )
        Sport one of advertisers absolute favourites of on this we see the above comment lamenting that you must have the sport channel when you want only one or 2 of the other channels however Advertisers know the person who watches sport is more likely to buy along with those that watch "Reality shows". Most of the Slashdot crowd is not their target market. you were likely the first to install Ad-Blockers, and download shows from the internet without commercials (thank you to those who made this possible). and be
      • Comment removed based on user account deletion
    • They can't just provide a la carte programming. The cable packages are decided based upon negotiations with the content providers. They insist on not having a la carte programming so the only choice the cable companies have is to drop the provider or carry all of the channels they insist upon.

  • Cable companies still have a pipe to your home (Score:4, Informative)

    by ardmhacha ( 192482 ) on Sunday May 10, 2020 @03:23PM (#60045110)

    Cable companies still have a wired connection into your home. In most case the telephone company also has a connection ( I am not sure what percentage is high speed)

    They will be around in one form or another. In theory having two high speed lines into your home should provide some competition, higher speeds with lower costs, but I have not seen much evidence of that.

    • They aren't going away at all. They will just offer Internet instead of cable, and jack up the price to make up for not offering cable any more.

      I know plenty of people that have asked me about just getting Internet through our cable company. It's what we do at work. 100 Meg down and it has only went down briefly in going on a year of using it.

      The DSL in my down is CenturyLink. It is some kind of garbage, unless you are in a good spot on the system. Only bad thing about cable is that you can usually forget a

    • Yep. The much larger satellite losses are showing just how important that is. I'm not sure about the competition. In my suburban city of 118,000 Comcast has spent a fortune putting in fiber so they can deliver more bandwidth. They are currently selling me 200Mbps downstream, 6 Mbps up. The local telephone company has spent very little on fiber, and the "competing" service is 25 Mbps down, less than a megabit up, at a somewhat higher price.

    • Re: (Score:2)

      by DewDude ( 537374 )
      My "telephone" company offers me a high-speed connection. They also provide me television service.

      The likely result is these companies will require you to subscribe to a television package in order to remove things like stiff data caps. They could also begin to tack on extra service fees that amount to a television subscription as a "penalty".

      Lack of neutrality laws means they can do whatever they want. Refusing to offer you unlimited internet service without paying for a television service is fine. Outri

    • Once SpaceX deploys their sat based internet with lower pings that by landline you will see real price competition in most markets. Starlink will be major game changer in all but the biggest urban areas where antenna space will be limited.

  • Hope it does (Score:4, Informative)

    by DaMattster ( 977781 ) on Sunday May 10, 2020 @03:40PM (#60045158)
    Cable TV has long been overpriced and outdated. I don't know why, with modern IP TV services, there is not true a la carte pricing. Of the channels offered, there are perhaps 5 that I watch. I don't care about the others. I wish there could be an offering like 0.25 per channel. I would pick the channels I want and forgo all of the ones I don't. The Cable TV industry has long been one that is absolutely ripe for disruption. Currently, the best offering is Philo TV with a flat rate of 20.00 per month and over 50 channels. It works better than SlingTV and AT&T. But even with Philo, the most I ever watch is just the 5 channels that I am interested in: Discovery, ID, NatGeo, NatGeo Wild, SyFy, and History.

    • Re: (Score:2)

      by DewDude ( 537374 )
      It's largely because the content providers for those channels demand you buy all the channels. Cable companies have actually wanted to offer al-la-carte for years; Verizon tried and got sued. Most don't realize that in order to carry something like Disney; the cable provider is required, by Disney, to purchase all the ESPN channels, and a plethora of others; and provide those at a minimum tier of service. That's right; in addition to requiring companies to buy (and sell you) all or nothing; they also get to

      • If it's all or nothing, I'll take nothing.

        On the other hand, everything Disney has outside of sports can be binge watched during a trial period, then dropped.

    • The people dropping cable are seeing the same thing you've realized. The difference is they've realized that those 5 channels they care about aren't as important as they think and that streaming services provide alternatives.

      The only thing streaming doesn't provide well is sports and that's beginning to change with the leagues offering their own streaming services.

  • Perhaps this has something to do with 30M newly unemployed people looking to trim unnecessary expenses, and for the cost of a set top pair of rabbit ears most Americans can enjoy lots and lots of free Over The Air TV.

  • NBC/Comcast is releasing Peacock soon

    CBS All Access has been around for a few years

    Philo TV has cheap sports less bundles and Sling has cheap sports lite bundles

    Pluto TV is free

    The only companies in trouble will be the TV operators who act as middle men for OTT bundles

    The only people in trouble will be clueless old people who will continue to pay high prices and maybe the hardcore sports fans

    • Re: (Score:2)

      by bodog ( 231448 )

      Pluto TV had a dedicated Dallas Cheerleaders channel, what do Cable companies offer that competes with free DC Cheerleaders?

    • Don't worry, after corona there will be a significant percentage of those older ones no longer alive to pay a cable TV bill. The hardy ones still only have about a decade or two left on the clock.

    • I'm really happy with what Pluto offers. They have some commercials and they can be repetitive but you can't beat free. They have a lot of movie channels and I usually keep one of them on in the background.

      On a somewhat related note. Since they only have so few of the same commercials how hard would it be to use an OpenCV type of software but for audio to mute the commercials? Ok you have to record some samples but this seems trivially easy in Linux to find a pattern match in milliseconds and then mute the

  • While they killed themselves years ago, the fallout from it is only recently becoming obvious
    due to being in the spotlight now.

    The pandemic is only an issue because people are out of work. No paycheck = cost cutting
    goes into effect, jettisoning ( and prioritized ) by services they can do without. Not surprising,
    Cable and Satellite are usually at the top of the list.

    The real problems that media executives seem to be oblivious to are:

    1) The cost is too high
    2) The platform has simply become an advertising

  • Netflix, meanwhile, signed up more than 15 million new subscribers in the first quarter.

    Netflix is currently dominant in a cut-throat content business. Every single one of those Netflix subscribers is paying not just Netflix, but an internet provider. In Comcast areas, the vast majority of Netflix's content is delivered over Comcast's pretty profitable internet service. I suspect Comcast of playing a long game in the content field generally, dabbling now with content they own themselves while waiting f

    • Just how profitable will Comcast be without Cable TV revenue?

      That is the question you haven't asked. Comcast's internet has always been extremely profitable (nearly pure profit) precisely because the cable subscribers were paying for the network with the internet side occupying a single channel of the cable network it operated as a pure profit center. But you eliminate the cable revenues of which Comcast keeps about 20% of the cost and you suddenly have a company that is taking in less than 30% of the prior

  • It turns out that once people are out of work (Score:5, Insightful)

    by VAElynx ( 2001046 ) on Sunday May 10, 2020 @04:19PM (#60045344)
    and sitting at home, they finally have the time to go through the cable TV cancellation process.

    • And they also have time to watch more and realize how little quality content there is.

      It's one thing to pay $100/month for access to $100 of content you don't have time to watch.

      It's another thing to pay $100/month for $10 of content that you now realize is all there is.

  • Paying the last mile internet provider to deliver Disney and Netflx ("cord-cutting") is just not that different. It's time-shifting with the hard drives at the provider. I think this is a good change, but paying $50 for internet and $25 for streaming services is not some sort of anarchist victory.
     

  • Cable TV is one of the biggest ripoffs.

  • If I pay for a cable tv subscription, I I also have to pay for a 100 channels I don't want. When I pay for Netlix I get one channel I want. No sport exacerbates the effect for the populace. Seems that is a psychological nut the Cable Companies have yet to crack....

  • It will pick back up when sports do.

    Also, not only are cable companies remaining relevant by becoming ISPs, but telcos are also becoming cable companies, e.g. ATT. ATT is delivering combination cable modems/DSL modems with IP telephony hardware in them to customers who currently cannot get ATT cable. But all ATT has to do is put the cable lines on their poles and they can be a cable provider here too. (Yeah, they need some other hardware besides coax, but it's not like they can't afford it what with all the

  • Chances are you get your broadband from the same company anyway, so they'll just phase out TV and jack up your internet rates. Then there's Comcast who does it all: content creator (NBC), internet provider, and streaming service to be launched soon.
    You want out? Get an antenna.
  • All I know it's that torrenting has never been faster. Looks like people have taken the time to sort certain things out. Cable TV, out, file sharing and other things, in.

  • It seems that every studio has its own paid streaming service. New content is going directly to streaming. I don't want to pay cable, Disney+, Netflix, Peacock, Prime, Hulu, HBO, etc, With people fearing unemployment waiting for the economy to reopen each entertainment venue is scrutinized even further.

  • Cable subscriptions are slowly declining (2% isn't that dramatic).

    They continue to decline.

    What exactly about the pandemic is related to the decline? Or is this just another "because coronavirus" kind of excuse that everybody is using now?

  • Comcast 20+ million [statista.com] customers. A loss of 900K, while higher then the expected churn, isn't really going to change anything.

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