Editorial: Cable TV Could Be Dead in 2 Years




Cutting the cable connection to coax connector illustrating people cancelling cable TV service

Cutting the cable connection to coax connector illustrating people cancelling cable TV serviceOver the last year the debate about the future of cable TV has become not if but when will it die. The conversation has become grim when talking with many who work in the pay-TV world. This is a far cry from just a few years ago when cable executives seemed confident that cord cutting would be nothing more than a speed bump.

Note: So what do we mean when we say cable TV will be dead? We define that moment as the day that more than half of American households no longer pay for cable TV. Cable TV may never fully die off just like you can still by vinyl records, but we firmly believe in the future cable TV will be relegated to a small fraction of the American population. Likely the Americans who will keep cable TV are your most hardened TV fans.

So how quickly could cable TV die?

Right now the rate of cord cutting is slightly slower than first expected. Many are pointing to a strong job market as a reason people are not flocking to cord cutting. Yet cord cutting is still setting growth records with the first quarter of 2018 set an all-time record for new cord cutters.

So when is cable TV going to die off like 8 tracks? No one knows, but after talking with many executives inside the industry it could be as soon as 2 years and as late as 15 years from now.

Even with the strong economy, we are already seeing CenturyLink stopping plans to expand their Prisma TV service. AT&T is going to offer a streaming version of DIRECTV. Verizon also plans to move Fios TV to become a streaming service and this is a good economy.

Cable TV Dead in 2 Years…

If at any point the US economy has a strong correction or a full-blown recession, cable TV could be dead in as little as 2 years. When we say dead, we mean that in just 2 years most small cable TV providers will no longer offer TV and over half of the United States will no longer pay for a cable TV package.

One of the major events that caused cord cutting to start was the 2008 economic collapse. It happened just as streaming started and new OTA stations launched. If that would happen again today with all the streaming options out there, the rate of cord cutting growth could be explosive.

Cable TV Dead in 10 Years…

If the economy stays strong and unemployment stays low I can easily see the death of cable TV taking 10 years. Many studies have shown that while money is not the only reason people become cord cutters, it is one of the main reasons. With over 90 million subscribers still paying for traditional pay-TV cable TV could hang on for 10 years even if losses double this year.

What do I think will happen?

That is hard to say. While cord cutting has never grown this fast before it has clearly grown slower than some had predicted. I do agree with the executives who say the strong economy is helping cable TV keep subscribers they would have already lost.

I think cord cutting will continue to grow year after year. In the next 5 to 10 years over half of the US will become cord cutters. The only question is what will the economy do next. If it stays strong, 10 years is a more likely target. If it weakens, 5 years is a far more likely target.

With that said I can easily see a situation where cable TV could be dead in just 2 years if the economy has even a slight hiccup. If I was a cable executive I would be doing everything I could to keep the economy strong to buy time to find a way to address cord cutting.

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