THB # 226: Twilight of the Cable Gods

One title I was considering for this piece was, “How To Save Cable… For Now,” because that is really why I am writing it.

We all know that cable and satellite, as we have known them, are going to be a memory in a decade or so. The simple functional reality of the internet as a cheaper and more and more equal or superior delivery system assures this.

But that is not a basis for how it should be approached as a business model.

There is half a trillion or more left in the cable/satellite business. And as obsessed as people are with The Next Thing, we are far from cable/satellite being a breakeven (or worse) play.

But aside from just riding out the storm, it’s time for the cable segment, channels and cable systems, to get serious about extending the life of the business they have.

The idea of a bundled channel offering is still strong… but it’s way too expensive to last, more so in the cable/satellite universe, but even on Streaming Cable like YouTubeTV and Hulu Live TV. The Streaming Cable business is really in its early days, with just about 12 million households signed up. The $65 base is a huge cost savings from what people tend to be paying for cable or satellite now. But at some point, people will start seeing this number as part of their personal household bundle.

I believe that at $40 a month for 75-ish “basic” channels, Streaming Cable becomes nearly universal domestically… which seems to mean about 75 million households these days. (The claims about password sharing - reducing the household count - are a bit delusional, given that paying for multiple streams is part of most streaming offerings.)

That’s a $40 billion a year business, just in US/Canada.

No, it is not a $140 billion a year business, which cable/satellite has been.

But it’s a legitimate, significant business… as opposed to “this is all going to burn to the ground.”

At this point, Comcast’s Xfinity and Spectrum do not offer a standalone Streaming Cable option, competing with YouTubeTV and Hulu Live.

It’s time.