While cable providers over the past few decades have grown fat off of exorbitant cable packages that overcharge and under-deliver, the rise of streaming services like Netflix, Hulu, and Amazon Video are finally righting the ship and shifting the balance of power towards the consumer. Clearly, the cable industry is in the midst of a transition.
Netflix in particular, with its ever-growing stable of original content, has proven to be a particularly painful thorn in the side of cable providers who are increasingly struggling to keep subscribers from cutting the cord.
Now comes word via The Wall Street Journal that cord cutting isn’t just on the rise, but is accelerating rapidly. Citing data recently compiled by eMarketer, the Journal relays that the number of households with cable “will fall at an accelerating rate for at least the next four years, reaching a 1.4% decline in 2019, eMarketer estimates.”
That being the case, eMarketer believes that 23% of U.S. households by 2019 won’t be subscribed to any type of cable service at all.
Interestingly enough, cable providers not only have to worry about keeping subscribers, they’re also facing challenges in getting consumers to sign up for cable in the first place.
As we highlighted a few weeks back, TV viewers between the ages of 18 and 31 are signing up for cable in ever decreasing numbers, a fact which isn’t all that surprising given that a new generation of consumers are being brought up in a Netflix and YouTube world where the prospect of paying $100 for cable seems utterly outlandish.
While cable isn’t going anywhere anytime soon, the industry on the whole will have to eventually do something to prevent things from becoming dire. As the chart below illustrates, cable subscriptions are slowly trending downward while Netflix continues to enjoy tremendous growth.
Of course, if there’s one thing cable providers can do to really try to stem the tide of fleeing subscribers, they might want to try making their cable packages just a tad more affordable. As we highlighted last month, cutting the cord truly does save boatloads of money. Simply signing up for Netflix and Hulu alone, for example, will only set you back $18, a price point which is far cheaper and offers far more content than any equivalent cable package in a similar pricing tier.