Are you tired of being forced to pay for gratuitously bundled cable TV packages with hundreds of channels you aren’t going to use? I have some good news! You can now supplement your cable television experience through paid, monthly subscription services such as Netflix and Hulu!
Are you overwhelmed trying to keep track of all those services you’re currently subscribed to, and looking for a balanced, all-a-round package where you can pick and choose what kind of content you want? I have more good news! Cable TV is back in the form of live-streaming and has traded gratuitous channel bundles for much more economically, a-la-carte-based packaging system.
Just in my lifetime computers and the Internet have gone from rare commodities to necessities, and cell phones today would be considered supercomputers, going far beyond what was previously thought possible 20 years ago. I believe no other field compares to how incredibly visible the Digital Media field is when it comes to evolution. Technology is always improving, and companies are scrambling to keep up.
For the last decade, the cable industry has been threatened by cord cutting and that threat is still growing every year with over 22 million adults canceling their cable subscription by the end of 2017. Consumers were looking for alternatives to cable television and the ability to stream high definition video reliably was the answer.
Streaming services have developed a lot since their original conception. Most services operate by licensing the content they stream from companies such as ABC and Warner Brothers. As companies like Netflix expand internationally, licensing costs go up significantly. Since 2012, Netflix is paying more than double in licensing fees, but has dropped over 40% of their content. Much of their spending, like other services have shifted more towards original content.
The picture above shows each services’ estimated budgets for original content in 2017. Each year spending has been increasing significantly between every service with Netflix being the forerunner in spending.
While streaming services are constantly evolving, so is cable television. Over the last few years, services such as Sling and Playstation Vue have entered the playing field as the best alternative to cable television. While streaming services such as Netflix intend on completely replacing television I believe that Sling and Playstation Vue can take a different approach and focus on co-existing with streaming services while still offering content that services like Netflix will never be able to fulfill. This would be the smartest strategy since Netflix and Amazon cover the video-on-demand market.
Television companies don’t need to waste money licensing properties that a service like Netflix already carries – it would simply add unnecessary operation costs which would inevitably lead to rises in subscription costs – and value is something these services need to capitalize on the most.
The demand for live television is never going to go away, and I believe that services such as Sling and Playstation Vue that offer a-la-carte style subscription packages are the perfect response to the ever-rising number of cord cutters. In fact, many of the cord cutters that I know that own homes have opted to subscribe to Sling specifically as a cost-saving method where they still get to fulfill their news and sports hunger without the costs of, say, getting their cable through Mediacom.
Do you think that live stream TV will become a casual consumer service such as Netflix where almost everyone will have it? How do you think live streaming TV affect subscription service numbers, if at all? Be sure to comment below!