Cord Cutting 2.0: Acceleration In The US
There are many disruptions taking place at one time. Technological convergence is bringing about new stacks that integrate with each other in ways unforeseen before.
About 15 years ago, we saw the advent what was termed "cord cutting". This was a shift away from the traditional cable package. It was a move that was based upon the Internet where people found their video content online.
This was aided by the success of Netflix. As other streaming services showed up, including YouTube, people found ways around the need for the cable subscription.
Part of this was the continued increase in price that cable companies kept pushing.
We are witnessing the second iteration of this, called Cord Cutting 2.0.
Cord Cutting 2.0 Is Accelerating
We are seeing history repeating itself.
Over the last decade, internet providers raised their prices to the point it is squeezing household budgets.
This is causing people to consider other options. As alternatives arise, we are seeing people taking advantage of them. At the same time, companies are getting aggressive in their approach, realizing they can scoop up some business.
We can see clearly that not only are cable customers still departing, but also ditching their Internet service.
It is a trend that started a number of years back. This is also accelerating at an increasing rate.
If this trend continues, Spectrum and Comcast will lose more than 3.5 million TV customers in 2024. This is on top of the more than 3 million cable TV customers Comcast and Spectrum lost in 2023.
When you consider the average bill for these services, it is a number that gets rather large. This is revenue that is lost each month.
New Competition
The traditional carriers are getting hit from all directions. When it comes to Internet service, the field is getting crowded.
It starts with satellite providers. We have Starlink from StapceX and another service from Bezos Blue Origin. These are going to provide service globally.
Then we have the mobile carriers. It is looking like 5G can be a viable competitor in many areas. This is bringing, in the US, companies like AT&T and Verizon into the arena.
Here we see a shifting in the market.
This is causing them to get more aggressive in their plans.
Naturally, services are a bit slow to roll out. That said, they are expanding operations bringing more options to people in each area.
Hit To The Bottom Line
Spectrum is owner by Time Warner. This is one of the long time Hollywood studios.
We have covered the plight of Hollywood over the past year or so. If the infrastructure revenue starts to decline, this could really affect the bottom line of the company.
The moats previously enjoyed by companies are eradicating. industries are merging into each other as the operations get less expensive to set up.
Big Tech is stretching its wings. Here is another example where an entity like Amazon is penetrating new markets. On the flip side, how long until mobile operators start to enter the broadcast realm?
Companies will do what they can to hold onto customers. We are also going to see others getting aggressive in trying to poach what they can.
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There's been competition at least in my area. Instead of it just being spectrum there's another up for grabs which is fiber over cable and a lot of people have gone with that option.
Tides are turning and they are turning fast🤩 Exciting and great things are just over the horizon!
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I guess the depreciation of the economy system is world wide, people are looking for alternatives
All over the world one way or the other to suit their budget
I'm very annoyed that Comcast has a monopoly over where we live. I am looking forward to getting away from those assholes!
Over here we dont even make use of some certain network just to reduce the budget of things I guess this is world wide
A lot of cable has offered faster internet for the past years, and it seem to be the only way they can stay relevant. I don't know a lot of people my age that still have cable, and only the boomers seem to have it. Once a lot of cable shows transfer to streaming services, that will truly be the end of cable.
That might be the case but it does get to a point where people have enough speed for half the price. If that is the case, it is a major shift.
I've noticed a big increase in full length movies on YouTube and most of them are ad free as they are predominantly vintage or out of copyright and so not attractive to advertisers who assume that the target audience is not watching these old classics.
I've been watching early Marlon Brando movies and ww2 movies and not a single ad!
YouTube wants to dominate the online world and destroy competition. Shorts as well as longform video.
Cable cutting 2 is well underway. My only concern is the danger of monopoly creeping in.
How is a monopoly forming? Things are actually going in the opposite direction. YouTube wants to dominate shorts but the king is TikTok. So there are a lot of places to watch video and they are expanding.
While this above statement appears true what we are seeing is agglomeration into silos like Disney hosting their films where eventually you will only be able to access the films via subscription.
The same is true for Time Warner etc.
Once you could see movies from all media groups on one platform like Roku etc. Those days are disappearing fast.
Maybe a cartel is a better description.
You will find movies from various outlets rotating between Roku, Sky and other platforms some of which are free on one platform but buy/rent on other platforms. A couple of months later and these same movies swap places and swap access to buy/rent.
It's the illusion of choice.
You are presuming they are the only creators of films.
Why do you focus upon Disney or Time Warner? There are a lot of other studios emerging. Plus, with the next level of content generation, you are seeing it even further.
The fragmentation is well underway.
Time Warner and Disney were used as examples. Of course there are many more companies and individuals that are creating films.
Now that anyone can get access to really good camera and audio equipment there has indeed been an explosion of new film. The question is as has always been...distribution.
The mentioned corporations et al are acting as gatekeepers for new filmmakers. Fortunately we have our own distribution networks albeit small at the moment.
These big studios days are numbered. I don't think we disagree on this. Just the method of change that is taking place.