If you are thinking about dropping your cable/satellite subscription--and really, who isn’t?--one of the necessary exercises is to figure out what network shows you will lose easy access to, and, significantly, how many of them you can get via subscription online video on demand outlets.
It’s hard to sort out, actually, because off-network shows turn up with various levels of staleness, and because you can find packages of programs at various price points.
According to Decider.com, for example, you can buy views of ABC’s “Modern Family” from six places, and get it “free” with advertising from Hulu. You can get six seasons of “Breaking Bad” on six SVOD services, or free as a part of a Netflix subscription.
And you can get yourself crazy trying to figure this out.
But according to The Wall Street Journal’s CMO blog, cable execs are beginning to realize that licensing all that content to online sites is a also good way to loosen a viewer’s allegiance to the original cable source.
Now that it appears cable TV is, really and truly, losing subscribers to online, networks and producers will likely be thinking twice before selling rights to Netflix, Amazon or other OTT players. That puts program producers/networks in a tough spot. Online SVOD outlets can be a lucrative place to syndicate shows, but if putting them there weakens their overall popularity, that’s some complicated torture.
The Cabletelevision Advertising Bureau, according to the CMO story, told a group of cable executives last week that about 40% of cable’s viewership declines in the third and fourth quarter of last year are attributable to viewers watching online sources instead.
Is it necessary to get tabulated proof of market forces even though they are so plainly evident? Apparently. Even though cable can’t exactly prove those numbers, CAB based that 40% figure on Netflix’s own public statements.
Traditional TV viewing is down an average 13 minutes per viewer over the last year and Bernstein Research’s Todd Juenger estimates Netflix’s is up 12 minutes, which would seem to explain the shift pretty neatly, if those Netflix minutes are close to being accurate.
As the New York Post’s Claire Atkinson put it: “Netflix, Amazon and Hulu Plus are no longer just nibbling away at the fringes of the pay-TV business — they’re eating its lunch.” That was in her story about those Nielsen numbers the other day that show 40% of American households have a subscription video service, that 36% of households have a Netflix account and 13% have more than one SVOD subscription. There's more to come.
On Wednesday, CBS’s Leslie Moonves reiterated that Showtime will soon join HBO Now as a standalone online service, so the tilt to online is just beginning. “The days of the 500-channel universe are over,” Moonves said.
He’s probably right. Instead, you’ll have 5,000 email@example.com
No one wants to state the other obvious elephant in the room - PIRACY. Any TV show and sports programming is available on the internet.
I think that "nibbling" away at traditional TV's audience tonnage is a more apt description of what is happening than "eating their lunch". Traditional TV could withstand years of 13 minute losses and still dominate the average viewer's total time spent stats. The broadcast TV networks and major cable channels have already started to launch their own "stand alone" content services and this will shortly become a deluge, as they follow whatever viewing is defecting to alternate distribution channels. Soon, we will be swamped with such services, all reaching fairly small constituencies; many of these will be line extensions for traditional TV programmers, including, no doubt, ad sales as well as subscription fees in their business models.
Consumer confusion. In order to gain, we all lose.