The C’s that Killed Cable: Cost, Content, and Choice
My House of Cards addiction is not only a sign of the lack of self-control and discipline that plagues millennials worldwide; it also proves that cable, as we once knew it, is dying. According to our BAV data, millennials are increasingly migrating towards Apple TV, HBO Go, and Netflix and away from traditional cable brands like Time Warner and Comcast, which may soon become a single and united entity.
The impending merge proves that the issue is top of mind for cable providers as, according to today's New York Times,"The merger could also strengthen Comcast’s position in its dealings with businesses like Netflix."
Millenials resent paying for cable for a multitude of reasons, the first of which is its hefty cost, and cable providers should be panicking. Data from a variety of sources shows that people of all ages are rapidly hitting the “unsubscribe” button on cable, but millennials aren’t signing up for cable in the first place. A Mintel report recently forecasted that at current prices, even in the best-case scenario, the cable industry will shrink by $3 billion dollars by 2018.
The second reason for this “great migration” is content. Not only can I pay less for Netflix, an Apple TV, and TV antennae, but I can also get far better content and far more bang for my buck. TV, once the “lowbrow” money-maker for screenwriters and actors alike, is now the breeding ground for content that rivals the silver screen. This year gave us Mad Men, Breaking Bad, and, of course, House of Cards, which won countless Emmy nominations and was just renewed for a third season. Great TV is even found in unsuspecting places, like PBS, whose hit “Downton Abbey” was the second most watched program behind the Superbowl. Although Mad Men and Breaking Bad are on cable channels, the number of non-cable companies that are quickly breaking into Cable’s territory is quickly rising.
A third explanation for the departure from cable is that Millennials are commitment-phobes. From the fact that 42% of people respond “maybe” when replying to a party invitation to the fact that 91% of millenials expect to stay in a job for less than three years, 18 to 30 year olds have shown they are averse to making definitive and binding decisions. When it comes to TV, millennials would rather decide where and when they watch their beloved TV shows than commit to slotted times and weekly paced seasons dictated by cable providers.
So where to from here? What this all comes to show is that the Cable TV model is in dire need of disruption. Can cable providers rise to the challenge and reclaim their audience? Or will cost, content and choice be the three C’s that killed cable?