Cable TV is getting competition from streaming options for TV viewing
There are two factors causing American households to reconsider their cable TV subscriptions: cost and alternative modes of TV viewing.
“Cutting the cord’’ has come to mean something other than a hospital occurrence, as some American households give up their cable or satellite TV packages. In a report from the fourth quarter of 2012, Nielsen, which monitors entertainment viewing habits around the world, said that more than five million households in the United States are considered Zero-TV households, up from just two million in 2007. “Zero-TV” does not mean they don’t have television monitors in the home, but that they don’t use them for watching broadcast, cable or satellite TV on them.
Of those Zero-TV households, 37 percent were getting their video content on their personal computers (via software), 16 percent were getting it from the Internet, eight percent were viewing on smartphones and six percent were viewing on tablets.
The Federal Communications Commission said that in June of 2012, cable television market share of American households fell to 55.7 percent, satellite TV had 33.6 percent of the market, and there remained 9.7 percent, or 11 million households, still using over-the-air broadcast TV without cable or satellite.
The Wall Street Journal recently published an estimate of average cable TV costs in America at just over $73, a number that takes into consideration all package sizes and only the cost of television over bundles with Internet and telephone service.
Meanwhile, the world continues to get new products providing TV services without the use of cable or satellite connections. They have come to be known as Over the Top devices (like Slingbox) or providers (like Hulu or Netflix). On Monday Netflix reported having 29.8 million U.S. subscribers.
Google, Intel and Apple are all working on creating Over the Top, or streaming, video plans to compete for market share, but they run into conflict with the cable companies’ bundle plans as they try to negotiate for content.
For the foreseeable future, the overwhelming belief is that cable and satellite TV will survive, but will eventually have to respond to viewers’ desires for lower costs and less bundling of channels. Kevin Lockett of Lockett Media, in an interview with readwrite.com, compared cable TV to AM radio, which still exists.
“We’ll always be able to choose cable,” Lockett said. “It’s in their best interests to appeal to their customer base and they eventually will.”
Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.
In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.
McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.
McDill is the father of four children, and an active fan of soccer, Jimmy Buffett and all things Disney.