As the month of September comes to a close, a feeling of despair arrives with the knowledge that the dreaded Comcast bill will soon make its way into the confines of my mailbox. Each month I vow to cancel my cable subscription and only use Netflix but I have yet to do that.
I am a part of the broad majority of Americans who say they are going to cut the cord and never follow through; only about 2% of Americans have given up cable for a full-time dependence on Netflix or Hulu for their entertainment needs. This statistic is surprising considering that when people are polled about their cable companies (Comcast, Time Warner, Cox, etc.) they tend to give them the big thumbs down–high bills, mounting service fees, and inefficient technical support are all major factors.
Even though cable customers are consistently dissatisfied with their service, few are reluctant to give it up. The apparent difficulty of cancelling cable may be a factor (remember the Comcast rep who refused to let a customer cancel his cable? If you forgot, take a listen; be warned this clip may cause stress and teeth-grinding… http://www.huffingtonpost.com/2014/07/14/the-comcast-call-from-hell_n_5586476.html) While the number of cable customers does not seem to be declining steeply, the types of services these customers are willing to pay for are. Customers are using a mix of Netflix and Hulu (otherwise known as over-the-top services or OTT) and cable in order to meet their entertainment needs. Instead of spending money on services such as On Demand and making their cable bill even higher, these consumers tend to look towards OTT services for individual content.
Michael Malone, the director of market science at Clearwire, believes that as long as these OTT services become easier to use, there will be a shift towards “streaming services and away from traditional cable.” Malone also believes that price is not the main problem–access to content is. He states that consumers will be significantly happier, regardless of the price, if they are able to pick and choose the stations and services instead of subscribing to a whole package. Cable companies are reluctant to let their customers pick and choose; it makes their business very difficult because they will have to market every channel as opposed to big blocks of channels. Not only do cable companies dislike this but networks are opposed to the idea of picking and choosing as well. Cable companies pay the networks per subscriber, regardless of if they actually watch the channel or not. If consumers get their way, networks will lose out on money and the chance to launch new channels.
While it seems that both cable companies and networks alike are opposed to changing their ways, Malone is adamant that cable companies will ultimately have to give in to the demands of their customers. For example, in 2015 Verizon is planning on launching an internet-only service that will “give consumers the opportunity to only pay for the stations they watch.”
Whether we, the consumers, like it or not, cable is here to stay. Though their deals, packages, and services may change, the dreaded cable bill will continue to haunt mailboxes everywhere.