What’s Behind the Cable TV Curtain and our Future?

Tanner | Aug 23, 2011

What has happened over the past decade to the entertainment industry is little more than a peek of what’s to come in the next few years.

Is it true that the internet has destroyed TV? Close. Though, if we look at the full picture of what’s happening with cable TV we’ll see that the internet isn’t the culprit for the decline in revenues. At least, not entirely.

Yes, people are downloading movies and TV shows without paying for them. Yes, the industry is hurting and trying to wiggle into a different shape in order to fit the change that’s occurring, but even that hasn’t been enough to stop TV companies from staying above water.

Has it?

If we look at revenues for some of the largest entertainment corporations in the United States – News Corp, Disney‒ABC, CBS, NBC, to name a few – we see numbers that aren’t only drifting or slowly falling, we see a lot of increases. Cable TV networks are actually growing in terms of revenue, so why are these service providers – Comcast, DISH, DirecTv, HughsNet, etc. – struggling so much? Is our lovable high-speed internet really to blame? Are there really any issues to be addressed or are these companies just complaining?

For some companies, such as Comcast, sales have been slowly climbing upward. For others, things have been fairly steady, though the past three years alone have been more of a sea of change than anything.

What’s happening is people are mostly tired of paying for subscription service. Why pay $60 today when I could just buy the episodes and shows I want to watch at $1.99 an episode or less?

Of course, the problem here isn’t with the internet: it’s the consumers and the companies. You and I and the providers. Not the technology. Hear me out with this.

The problem is that we, as consumers, feel like we’re being ripped off for paying so much only to watch a snippet of what we feel like we’re paying for. Of course that’s not true, however, because paying $1.99 or even $0.99 per episode of a show really adds up.

Cable companies don’t make enough on these small, episode-based downloads to cover their costs, and consumers are overlooking the fact that buying two episodes of an HBO hit series in HD (for example) is way more expensive than simply subscribing to TV service.

The mess, as it appears, is simply because consumers and companies can’t find any middle ground. There’s no understanding what one or the other needs and as a result we’re finding a lot of finger pointing and name calling going on. Is there a solution? Not that we can see right now. Though my hunch is on a future of cable TV service that blends what we’re dealing with today: affordable, digital downloading and cable subscriptions.

Think Spotify or Hulu for TV, at reasonable prices (though nothing like Netflix’s past $10/month level) and without contracts.

Cable TV certainly isn’t dead, and in some areas it’s actually growing, but consumers still aren’t happy and either are the service providers. There needs to be some coming together and middle ground here, or things are going to just keep getting stressful.

Illustration by Tang Yau Hoong.


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