Industry Claims That Cord Cutting Would Be A Fad Aren't Looking So Hot

from the adapt-or-perish dept

Remember when the cable industry used to pretend that cord cutting wasn't real? Or perhaps you remember that once the industry was actually willing to admit it was a real trend, they'd claim it was only something being done by losers living in their parents' basement?

Or perhaps you'll remember the cable and broadcast industry claims that cord cutting was just a temporary phenomenon that would go away once the housing markets stabilized and Millennials started procreating? Or how companies like ESPN routinely claimed that warnings about the trend were an unimportant fiction that should be ignored?

Good times.

While there are still a few sector analysts and executives here and there who'll bizarrely try to downplay one of the biggest trends in TV industry history, the numbers keep making it harder and harder to keep one's head buried a foot below ground. Last year, for example, once again saw one of the highest defection rates of traditional TV subscribers in recent memory. According to Wall Street analysts, the top pay TV providers lost 2.5 million subscribers last year alone:

Ironically the two companies that actually tried to adapt to the cord cutting trend suffered the worst losses. Both AT&T and Dish have launched DirecTV Now and Sling TV, respectively, in a bid to try and at least hoover up a few of these fleeing customers with their own streaming services. That's something to be applauded, especially since huge swaths of the sector have simply responded by doubling down on terrible ideas (from raising rates to fighting against real cable box competition). But even with adaptation, users are still fleeing to other alternatives (Amazon, Hulu, Netflix) instead.

It's not going to be getting any easier for entrenched pay TV providers, especially the ones that stubbornly refuse to compete on price. The streaming market will soon face a new rival in the form of Apple's and Disney's new Disney+ streaming service, which will be the exclusive home of most Star Wars, Marvel, Pixar, and Disney children's' programming:

"The clear implication is that year-over-year subscriber trends for programmers that improved throughout 2018 are set to worsen again in 2019,” Greenfield wrote. The analyst is widely known as bearish on the pay-TV sector, frequently using the hashtag #goodluckbundle in his commentary (as he did in Wednesday’s post). The cord-cutting problem promises to grow even more exacerbated as new subscription-streaming services from Disney (Disney+), WarnerMedia and NBCUniversal hit the market starting later this year. Those will via for consumers’ entertainment dollars against SVOD players like Netflix, Hulu, and Amazon Prime Video."

So if companies like AT&T and Dish are actually trying to adapt to reality, why are they seeing such major departures? Many of these users were on unrealistically cheap discounted promotions intended to drive adoption that ended. And some users were frustrated by the a price hike by AT&T in the wake of its latest megamerger with Time Warner. New streaming companies are also actually good at customer service, something the cable and broadband industry hasn't been able to get a handle on for the better part of a generation.

Between tight margins and an ocean of new arrivals, it's going to be pretty hard for the cable industry to make anywhere near the same profits they were used to during the heyday of cable TV. But that's generally how competition works. And you shouldn't feel too badly for the Comcasts of the world, since their solution will simply be to jack up the cost of broadband, where competition is far weaker. Still, there's a subset of executives who still seem to somehow believe they're owed a permanent position of dominance without having to work for it. That delusion is falling apart more quickly than most of them expected.

Filed Under: cable, cord cutting, over the top, streaming

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  1. identicon
    Anonymous Coward, 21 Feb 2019 @ 12:55pm

    Re: Re: Re: Re: Re: yeah but...

    And the answer is no, you have no idea what you are talking about.

    Actually they intend direct ground link for every satellite

    Actually what they intend is for customer base stations to use whatever satellite is currently the best in terms of range, bandwidth, usage, etc... You know, exactly what a "mesh" network does.

    as satellite to satellite communication, with satellites in differing orbits requires large and complex aerial systems on the satellites, oh and add to the latency

    Again, you didn't actually look into it or don't understand the technology. The satellites are ABSOLUTELY going to be communicating with one another as well as ground stations, both customer and uplink stations, and no it doesn't require large and complex aerial systems. That's the whole point. This ain't the 80s man.

    It's a mesh network. One satellite goes down and the network doesn't care because it has multiple redundant nodes to pick up the slack until a replacement node can be brought online. The latency introduced in this is no different than the latency in normal ground based networks since it's doing the same thing. Please do some actual reading on this.

    Also, relaying through another satellite reduces its ground station capacity for its users.

    Not necessarily. Not if the relay circuits and arrays are completely separate from the ground station relays. There's also the matter of whether the satellites are designed in such a way to have enough overhead to handle the increased traffic, as well as the fact that, once again, IT'S A MESH NETWORK. If one satellite is overburdened and would cause latency for additional traffic, that traffic gets routed to unburdened satellite. Please go read up on what a mesh network is and does.

    Also consider each satellite to be equivalent to a cell tower, (or maybe a couple)

    I absolutely will not. What possible reason could you have for thinking a satellite and a cell tower operate on the same technology and have similar capabilities. Nevermind that not all cell towers or satellites are standard cookie-cutter-can-only-handle-X-amount-of-traffic-and-no-more. Different cell towers and satellites have different capacities. You know less than zero about how cell towers, or the Starlink satellites, are designed and what their technical specifications are.

    Besides that, no major metropolitan area has anywhere near to 5000 cell towers, or even a few hundred cell towers. You are, in a word, full of it.

    It could be a nice system for rural areas, and providing Internet service to ocean areas for ships and planes; the latter using satellites that are not in position to serve the former).

    It would be a very nice system, but why would planes have to serve ships? The idea is global coverage. That means it doesn't matter where you are there is always a satellite in position to serve you. This just further shows you really have no idea what you are talking about.

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