It’s a trend we’ve been advocating for — ditching cable tv and going internet-only — quite some time, but the Financial Times looks at cutting the cable cord and the second digital tv conversion.
1. Viewers are pulling the plug on cable tv in record numbers:
The number of people subscribing to US cable television services has suffered its biggest decline in 30 years as younger, tech savvy viewers lead an exodus to web-based operations, such as Hulu and Netflix.
The total number of subscribers to TV services provided by cable, satellite and telco operators fell by 119,000 in the third quarter, compared with a gain of 346,000 in the third quarter of 2009, according to SNL Kagan, a research company.
Although television services offered by telecoms and satellite providers added subscribers over the period, cable operators were hard hit, with subscriber numbers falling by 741,000 – the largest decline in 30 years.
2. Part and parcel with that drop in cable subscribers is the rise of, what some analysts are calling, the second “digital switchover,” which is actually the merger between internet and television. Or rather, it’s using the internet to access television instead of cable subscriptions. It’s the natural progression from point number one. The reason this scares cable companies can be found in this quote:
“Through YouView and accessing the video-on-demand and archive and everything else, it moves it on to an a la carte menu, which is where people can have the majority of their television free and then pay for the things they want,” Mr Crozier said. “For pay platforms that’s quite difficult – the model there is to get people to pay for things you don’t really want [in order to] to get the things you do.”
By using the internet to access and watch television customers are allowed the freedom to pay for what they want, when they want it, instead of paying enormous monthly fees to have access to channels nobody really wants (which is part of the formula for how cable companies make their money).