WEBVTT - Is Cable Hanging By a Thread 0:00:04.160 --> 0:00:07.160 Get in touch with technology with tech Stuff from how 0:00:07.200 --> 0:00:14.280 stuff Works dot com either everyone, and welcome to tech Stuff. 0:00:14.320 --> 0:00:17.040 I'm Jonathan Strickland and I'm Lauren voc Obama, and today 0:00:17.040 --> 0:00:21.440 we're going to talk about something that is an interesting topic. 0:00:21.480 --> 0:00:26.360 It's really about cable and cord cutting and what is 0:00:26.400 --> 0:00:29.440 the deal there, what's going on with cable. We're not 0:00:29.560 --> 0:00:33.320 going to dive into the technical side of how cable 0:00:33.360 --> 0:00:37.080 TV works, because that's really its own episode all by itself. 0:00:37.120 --> 0:00:39.920 We're talking more about the business side, right right, because 0:00:39.960 --> 0:00:42.559 this is a really rapidly developing industry and and a 0:00:42.560 --> 0:00:45.040 lot of it's kind of freaking out right now. Yeah, 0:00:45.240 --> 0:00:47.600 because of the changes that have gone on in in 0:00:47.760 --> 0:00:51.680 the way that people are consuming content with greater broadband access. 0:00:52.000 --> 0:00:54.840 And actually before before we got started too far into this, 0:00:55.000 --> 0:00:56.800 we we did want to mention that, yes, How Stuff 0:00:56.800 --> 0:00:59.760 Works is owned by Discovery Corporation, which is a cable 0:00:59.800 --> 0:01:03.720 co intent provider. Yeah, it's a company that owns several 0:01:03.760 --> 0:01:07.360 cable channels. So, uh that that is a good point. 0:01:07.440 --> 0:01:09.200 That's something that we definitely need to get out of 0:01:09.240 --> 0:01:11.200 the way. And now it's out of the way. In 0:01:11.319 --> 0:01:16.040 the beginning, there was broadcast TV, and it was okay, 0:01:16.640 --> 0:01:19.400 So broadcast TV. Yeah, we're talking about you know, you 0:01:19.400 --> 0:01:22.920 had you had stations that could broadcast over the air 0:01:23.319 --> 0:01:25.759 as in there they are broadcasting radio waves. They would 0:01:25.760 --> 0:01:30.199 have a transmission antenna that would shoot out broadcast waves 0:01:30.240 --> 0:01:33.120 of TV, and you would have your little reception antenna, 0:01:33.240 --> 0:01:35.600 your little rabbit ears and you would have to tell 0:01:35.640 --> 0:01:40.280 your your your kid brother, no, no, it's still just snow. 0:01:40.440 --> 0:01:42.960 Turn it to the left, No, my left, not your left, 0:01:43.360 --> 0:01:45.240 until you could finally be able to watch all in 0:01:45.240 --> 0:01:49.120 the family or something so um the weird dated references 0:01:49.120 --> 0:01:51.600 that I don't even get anyway, the idea was that 0:01:51.640 --> 0:01:55.680 you would send this all through radio signals, but it 0:01:55.720 --> 0:01:58.400 did mean that, you know, you had a lot of 0:01:58.400 --> 0:02:01.760 different factors that could impact the quality or even the 0:02:01.800 --> 0:02:05.640 ability to receive television. It was pretty limited in power 0:02:05.640 --> 0:02:09.000 and scope. Yeah, you had a certain number of stations 0:02:09.040 --> 0:02:11.440 that you could receive, and they were all regionally based. 0:02:11.600 --> 0:02:14.600 You know. There weren't really any national channels other than 0:02:14.600 --> 0:02:17.160 stuff that could be rebroadcast from one from one tower 0:02:17.200 --> 0:02:20.119 to another. And um and and really, I mean, the 0:02:20.240 --> 0:02:24.040 thing about the electromagnetic spectrum is that it's not infinite 0:02:24.120 --> 0:02:26.080 I mean it's it's you know, it's pretty wide, but 0:02:26.120 --> 0:02:29.320 there's only so many radio channels that you can broadcast 0:02:29.360 --> 0:02:32.320 on right exactly, And it's different in different countries, like 0:02:32.360 --> 0:02:34.840 in the United States. If you look at the spectrum 0:02:34.880 --> 0:02:38.959 from a transmission standpoint, you'll see that there are entire 0:02:39.080 --> 0:02:43.360 bandwidths that are set aside specifically for things like television broadcast, 0:02:43.480 --> 0:02:48.040 radio broadcast, and then there's a whole bunch of government ones. Anyway, 0:02:48.200 --> 0:02:50.160 you know, you have to play within that and you 0:02:50.240 --> 0:02:52.400 can't play within the same space that someone else is 0:02:52.440 --> 0:02:55.440 playing with within that area, or else you get a 0:02:55.480 --> 0:03:01.760 signal confusion. So h There were other problems with this approach, 0:03:01.800 --> 0:03:03.520 and one of them was that people who lived in 0:03:03.560 --> 0:03:08.160 remote areas often could not receive any sort of television programming, 0:03:08.600 --> 0:03:10.600 which can be a problem if you want to use 0:03:10.680 --> 0:03:13.919 TV to communicate something widely, or you just want to 0:03:13.960 --> 0:03:17.280 try and reach as many potential customers. If you are 0:03:17.360 --> 0:03:21.040 someone who's creating ads on this television platform. U So, 0:03:21.280 --> 0:03:24.400 what could you do? While in nineteen which this actually 0:03:24.440 --> 0:03:27.960 surprised me that was this early n you actually had 0:03:28.000 --> 0:03:31.760 a few companies begin to experiment with delivering broadcast channels 0:03:32.520 --> 0:03:35.240 with cable. They were using the instead of using it 0:03:35.280 --> 0:03:38.440 as a broadcast radio signal, they were putting these signals 0:03:38.440 --> 0:03:42.240 through copper wires essentially. And this was just a few 0:03:42.280 --> 0:03:46.240 small communities out in Oregon, Arkansas and Pennsylvania. Yeah, Pennsylvania 0:03:46.280 --> 0:03:48.119 I think might have even been the very first one. 0:03:48.560 --> 0:03:52.400 So you start seeing this experiment. Now, in this case, 0:03:52.560 --> 0:03:55.440 it's really the broadcast channels that are being put over 0:03:55.480 --> 0:03:59.360 the cable. It's not like suddenly everybody had HBO right 0:03:59.520 --> 0:04:02.280 right now, know, um, And you know that television production 0:04:02.560 --> 0:04:06.280 to begin with was very small at this point, and 0:04:06.320 --> 0:04:08.080 it was not twenty four hours of content. It was 0:04:08.120 --> 0:04:10.040 just a few shows that would air at peak times. 0:04:10.160 --> 0:04:12.960 And uh yeah, we're talking like the same source stuff 0:04:12.960 --> 0:04:14.400 you would be able to see if you had an 0:04:14.440 --> 0:04:17.320 antenna and could pick up the local stations. So nothing 0:04:17.360 --> 0:04:21.280 beyond that. In nineteen sixty we started to see cable 0:04:21.520 --> 0:04:25.560 began to enter major metropolitan area markets. So now it's 0:04:25.600 --> 0:04:29.200 no longer just a tool to get television out to 0:04:29.240 --> 0:04:33.520 remote areas. Now it's an alternative to broadcast TV, but 0:04:33.560 --> 0:04:36.760 it's still at this point was mostly covered carrying the 0:04:37.320 --> 0:04:40.800 local area networks. It wasn't like again, there weren't like 0:04:40.880 --> 0:04:44.800 these big national UH companies that spread from coast to 0:04:44.839 --> 0:04:47.480 coast right It in fact wouldn't be until an entire 0:04:47.520 --> 0:04:51.160 decade later in nineteen seventy that the first UH cable 0:04:51.200 --> 0:04:54.080 programming networks would begin to launch. Right now, this is 0:04:54.120 --> 0:04:57.719 where we start seeing. We have the big broadcast companies 0:04:57.920 --> 0:05:02.480 still like ABC, NBCCB, Yes those were those were well established. 0:05:02.880 --> 0:05:06.320 But this is when we start seeing the smaller cable 0:05:06.360 --> 0:05:10.640 companies that were independent of these big broadcast companies become 0:05:10.680 --> 0:05:13.760 an actual thing and be able to get a national reach. 0:05:14.240 --> 0:05:16.880 Now before, if you were to create your own channel, 0:05:16.960 --> 0:05:19.320 you would have to be able to muscle in on 0:05:19.360 --> 0:05:23.200 that broadcast spectrum we were talking about. UH. This way 0:05:23.279 --> 0:05:26.360 you could suddenly have lots more bandwidth to play with 0:05:26.440 --> 0:05:30.480 and you could create, you know, your crazy wacky channel company. 0:05:30.800 --> 0:05:34.039 And a lot of people tried it, and so nine two, 0:05:34.040 --> 0:05:38.279 one of the biggest ones debuted that would be HBO. 0:05:39.200 --> 0:05:42.080 There was no UM and it's a it was a 0:05:42.120 --> 0:05:45.600 subsidiary still is of of Time now it's Time Warner, 0:05:45.640 --> 0:05:49.920 but it's just Time Incorporated. Yep. And they purchased it 0:05:50.040 --> 0:05:52.279 might sel familiar what they would do. They would purchase 0:05:52.400 --> 0:05:54.640 rights to recent movies, and they would also purchase the 0:05:54.720 --> 0:05:57.359 right the broadcast rights to sporting events, and that was 0:05:57.400 --> 0:06:00.960 how they made their name. Back in nineteen seventy two, Uh, 0:06:01.160 --> 0:06:05.400 nineteen seventy six saw another interesting development in cable. That 0:06:05.480 --> 0:06:09.480 was when TBS became a superstation. TBS ends for Turner 0:06:09.480 --> 0:06:14.120 Broadcast Station and uh after Ted Turner, who is, Hey, 0:06:14.320 --> 0:06:17.040 he's a neighbor of ours here in Atlanta. I mean 0:06:17.080 --> 0:06:18.840 not not a direct neighbor. I mean he doesn't live 0:06:18.880 --> 0:06:22.240 in my neighborhood. No, no, no, he could own my neighborhood. 0:06:22.240 --> 0:06:25.279 Several times over. His restaurant is right down the street 0:06:25.320 --> 0:06:30.039 from where I live, one of them, Ted's Montana Grill. Anyway, Um, Turner, 0:06:30.520 --> 0:06:32.640 he had this idea. He had this station that he 0:06:32.720 --> 0:06:35.080 had he was producing that was mainly for the Atlanta area, 0:06:35.160 --> 0:06:39.200 the Turner Broadcast Station, and he thought, well, with cable, 0:06:39.600 --> 0:06:43.520 I could turn this local station into a national station. 0:06:43.560 --> 0:06:47.679 I could distribute this local programming across the entire United States. 0:06:48.160 --> 0:06:50.800 And this was the first time anyone had had tried this, 0:06:51.000 --> 0:06:54.040 and it was a big success. Turner had had seen 0:06:54.080 --> 0:06:56.800 great success with the Turner Broadcast Station and many other 0:06:56.920 --> 0:06:59.640 channels followed suit. In fact, I remember as a kid 0:06:59.680 --> 0:07:04.159 growing up being completely flabbergasted that we were getting a 0:07:04.279 --> 0:07:08.960 station out of Chicago and it was Chicago programming and 0:07:09.240 --> 0:07:12.360 everything was an hour off. And also I remember being 0:07:12.440 --> 0:07:15.320 very confused about that. As a child, I had never 0:07:15.360 --> 0:07:19.000 seen Bozo the Clown until we got that channel. And 0:07:19.040 --> 0:07:21.200 then I became a big fan of the Grand Prize Game. 0:07:21.840 --> 0:07:25.960 Uh so lots of stations started experimenting with that. By 0:07:26.920 --> 0:07:30.800 cable television had exploded. In fact, that's right about when 0:07:30.800 --> 0:07:34.520 my family got cable TV would have been nineteen eighty UM, 0:07:34.560 --> 0:07:37.400 and dozens and dozens of channels began to join this, 0:07:37.680 --> 0:07:43.120 this new revolution in entertainment and and delivery. So this 0:07:43.160 --> 0:07:47.520 is when you started getting things like m MTV. First 0:07:47.840 --> 0:07:50.680 video on MTV, of course, video Killed the Radio Star 0:07:50.840 --> 0:07:55.840 by the Buggles, um, and then um after let's go 0:07:55.920 --> 0:07:59.400 forward in a full decade. Cable through this decade does 0:07:59.480 --> 0:08:04.120 really really well. Ah yeah, seven percent of households in 0:08:04.120 --> 0:08:07.920 the US are subscribed to some kind of cable video service. 0:08:08.000 --> 0:08:10.160 Yeah yeah. And keep in mind that when we're talking 0:08:10.200 --> 0:08:13.640 about cable here will also later be talking about things 0:08:13.680 --> 0:08:18.200 like satellite television. Uh, cable almost becomes like a just 0:08:18.320 --> 0:08:21.120 kind of a general term meaning right right, it's a 0:08:21.160 --> 0:08:26.000 weirdly antiquated in some ways. Uh yeah, umbrella term I 0:08:26.040 --> 0:08:28.640 think for for media. At this point, we're going to 0:08:28.720 --> 0:08:31.160 be using it mostly as shorthand meaning both cable and 0:08:31.200 --> 0:08:34.680 satellite when we get toward the discussion of cord cutting, 0:08:35.040 --> 0:08:37.880 just because saying cable and satellite over and over it 0:08:37.920 --> 0:08:40.200 gets a little tedious. Yeah, it would make our episode 0:08:40.320 --> 0:08:43.480 even longer. Yeah, and we heard your cries people two 0:08:43.520 --> 0:08:46.640 thousand one, actually mostly I hear our producer cry. In 0:08:46.679 --> 0:08:49.640 two thousand one, the average pay TV cable monthly bill 0:08:49.640 --> 0:08:54.520 in the United States was forty dollars sots. Yeah, we'll 0:08:54.520 --> 0:08:56.959 get into why that sounds lovely and a little bit. 0:08:57.000 --> 0:08:59.080 For those of you who actually are in charge of 0:08:59.120 --> 0:09:01.920 your cable bill, you already know why forty dollars a 0:09:01.920 --> 0:09:05.360 month sounds lovely. Uh. From two thousand and eight through 0:09:05.400 --> 0:09:08.080 two thousand eleven, this is a period that I wanted 0:09:08.120 --> 0:09:11.520 to talk about because, according to the Convergence Consulting Group, 0:09:12.080 --> 0:09:15.120 around two point six five million people in the United 0:09:15.120 --> 0:09:19.079 States dropped cable TV entirely. They just they stopped subscribing. 0:09:19.120 --> 0:09:22.760 They canceled their subscriptions, meaning that they also didn't go 0:09:22.920 --> 0:09:26.920 to satellite. They got rid of any sort of provider 0:09:27.000 --> 0:09:30.040 from that side. And we call this cutting the chord. 0:09:30.320 --> 0:09:33.679 Chord cutting where you're you're no longer getting your entertainment 0:09:33.720 --> 0:09:37.680 through these channels or these platforms is so confusing. The 0:09:37.800 --> 0:09:40.679 terminology here, by the way, is pretty tough because a 0:09:40.720 --> 0:09:42.840 lot of the words we want to use mean multiple 0:09:42.880 --> 0:09:46.800 multiple things. But anyway, the idea is that they go 0:09:47.000 --> 0:09:50.520 mainly either to the Internet for all their entertainment, or 0:09:50.559 --> 0:09:53.120 they don't know, go outside or something. I don't understand 0:09:53.160 --> 0:09:55.880 these people, honestly, But two point six five million people 0:09:55.920 --> 0:09:58.040 and now that might sound like a lot, but you're 0:09:58.080 --> 0:10:03.760 talking about lots and lots and lots of customers. Now. 0:10:04.000 --> 0:10:08.480 According to Nielsen, one point five million customers dropped multi 0:10:08.520 --> 0:10:11.800 channel subscriptions in twenty eleven alone. So if you think 0:10:11.800 --> 0:10:13.760 two thousand and eight to two thousand eleven, two point 0:10:13.800 --> 0:10:17.960 six five million of them dropped cable. If two thousand 0:10:17.960 --> 0:10:20.200 eleven one point five million of them did, that means 0:10:20.240 --> 0:10:23.800 more than half of that number dropped in twenty eleven, 0:10:23.840 --> 0:10:28.120 which could possibly mean we're seeing a trend that is 0:10:28.400 --> 0:10:31.520 on a very rapid climb right right. According to the 0:10:31.520 --> 0:10:35.760 Wall Street Journal, um was the peak of cable subscription 0:10:36.480 --> 0:10:39.600 cable subscribers actual the United States, and since since then 0:10:39.600 --> 0:10:42.360 it has been in in even more steep decline than 0:10:42.520 --> 0:10:46.960 this initial period of broadband affecting things right, right, And 0:10:47.040 --> 0:10:49.240 we should point out that if you look at the numbers, 0:10:49.240 --> 0:10:51.360 if you look at the full numbers of cable subscription, 0:10:51.400 --> 0:10:53.360 which is tough to do, by the way, you have 0:10:53.440 --> 0:10:56.120 to rely on a lot of different consulting groups doing 0:10:56.200 --> 0:10:59.280 their own work, because uh, it's it's not easy to 0:10:59.320 --> 0:11:02.439 get all these numbers and make them meaningful. But in general, 0:11:02.520 --> 0:11:07.200 it looks like satellite has had modest growth, and by 0:11:07.200 --> 0:11:11.840 modest I mean like one point six percent growth, cable 0:11:12.080 --> 0:11:15.280 has suffered a minor decline like three point one percent, 0:11:15.800 --> 0:11:18.400 and Internet provided TV or Internet I p t V. 0:11:18.520 --> 0:11:22.800 I should say UH has had a significant increase at 0:11:24.400 --> 0:11:28.080 for over a two year period. But while that sounds big, 0:11:28.200 --> 0:11:31.400 the numbers themselves are actually small. It's it's big growth, 0:11:31.679 --> 0:11:34.360 but it's like a small group of users into a 0:11:34.440 --> 0:11:37.839 slightly less small group of users, right, So if you 0:11:38.080 --> 0:11:40.360 if you go from five people to ten people, that's 0:11:40.440 --> 0:11:44.400 huge growth. That's right. But if another company loses five 0:11:44.440 --> 0:11:48.520 customers when it has millions, like they're like, what, I 0:11:48.559 --> 0:11:51.560 did not notice that buzzing little sound in my ear? 0:11:52.240 --> 0:11:54.959 So anyway, complicated issue. We'll get more into that in 0:11:55.000 --> 0:12:00.840 the second half. Now, in at that peak of able subscription, 0:12:01.080 --> 0:12:04.040 when we're seeing all this stuff happen, the average pay 0:12:04.160 --> 0:12:08.600 TV cable monthly bill is now eighty six dollars per month. 0:12:08.679 --> 0:12:12.679 So in two thousand one it was forty, it's eighty six. 0:12:12.679 --> 0:12:14.520 So and to be fair, there has been a pretty 0:12:14.520 --> 0:12:18.480 steep inflation rate over that period of time. Yeah, yeah, yeah, 0:12:18.480 --> 0:12:21.480 it's not it's not just that the prices doubled or 0:12:21.559 --> 0:12:25.560 more than doubled. It's also inflation which caused caused however, 0:12:25.600 --> 0:12:27.760 that's that's I mean, it's you know, the inflation rates 0:12:27.800 --> 0:12:30.520 certainly didn't go up that much, right, that was still 0:12:30.559 --> 0:12:33.959 a pretty pretty sharp And two thousand and twelve, the 0:12:34.040 --> 0:12:38.600 National Cable and Telecommunications Association estimated that there fifty seven 0:12:38.640 --> 0:12:42.160 point nine million customers for cable video and forty six 0:12:42.200 --> 0:12:45.679 point four million for digital video, So cord cutters are 0:12:45.679 --> 0:12:49.320 about two point five percent of the entire TV viewing population, 0:12:49.400 --> 0:12:52.360 So two and a half a percent of your population 0:12:52.760 --> 0:12:56.520 decides to stop using the product. That's not that big 0:12:56.520 --> 0:12:59.040 a number in the grand scheme of things, or it's 0:12:59.080 --> 0:13:01.040 not that big of a person synage, I should say. 0:13:01.520 --> 0:13:05.320 But another survey found that nine of cable company customers 0:13:05.360 --> 0:13:09.600 had canceled service within the that previous year. So nine 0:13:09.640 --> 0:13:12.040 percent of the people they surveyed said that they had 0:13:12.080 --> 0:13:15.719 canceled their service. So so again the numbers are are 0:13:15.840 --> 0:13:19.480 kind of squiggly and complicated. In twelve, New York Times 0:13:19.480 --> 0:13:22.720 reported that there had been about a three percent per 0:13:22.840 --> 0:13:26.840 year decline and cable subscriptions for a while, right, And 0:13:27.120 --> 0:13:29.199 you know, some of that might mean that it's not 0:13:29.320 --> 0:13:32.960 just people canceling, but we'll we'll explain that in the 0:13:33.000 --> 0:13:36.920 second half. So twenty thirteen, that's this year we're recording this. 0:13:36.960 --> 0:13:41.440 In August two thousand thirteen, um Nielsen reported that in 0:13:41.520 --> 0:13:45.160 its fourth quarter two thousand twelve cross Platform report that 0:13:45.240 --> 0:13:47.400 there were more than five million households in the United 0:13:47.440 --> 0:13:52.400 States that fit its zero TV definition, which that definition 0:13:52.480 --> 0:13:55.640 meant that the households got entertainment not through television but 0:13:55.679 --> 0:13:59.440 through computers, smartphones, and tablets, and that in two thousand 0:13:59.480 --> 0:14:03.400 seven it was sorts of two million, so more than 0:14:03.400 --> 0:14:06.000 doubled within six years. Now. We should also point out 0:14:06.080 --> 0:14:08.440 that this is kind of a weird definition to say 0:14:08.520 --> 0:14:12.200 zero TV and that they only get their their their 0:14:12.360 --> 0:14:17.200 entertainment through computers, smartphones, and tablets, because there are lots 0:14:17.200 --> 0:14:21.120 of different solutions out there, set top boxes, for example, 0:14:21.280 --> 0:14:25.400 that are not getting cable or satellite. They're getting Internet content, 0:14:26.160 --> 0:14:29.640 but they are streaming television. Yeah, they're streaming to a 0:14:29.680 --> 0:14:33.240 television set. So I don't know if the zero TV 0:14:33.760 --> 0:14:37.520 definition takes into account those people. See I'm one of 0:14:37.520 --> 0:14:40.120 those people. I have, like you know, I have an 0:14:40.280 --> 0:14:42.680 Xbox three six which pulls in content. I've got a 0:14:42.720 --> 0:14:45.080 PlayStation three which pulls in content. I've got a Chrome 0:14:45.160 --> 0:14:48.800 cast that pulls in content. I've got Roku that pulls 0:14:48.880 --> 0:14:52.160 in content. Um, I got a lot of these devices, right, So, 0:14:53.000 --> 0:14:55.200 but I do watch the content on the television. So 0:14:55.240 --> 0:14:58.720 I don't know that, you know, if that definition doesn't uh, 0:14:58.800 --> 0:15:02.080 if I don't fall under the zero TV definition, there 0:15:02.120 --> 0:15:05.680 may be even more people than we're in this report 0:15:05.960 --> 0:15:09.640 that do not get their content through a cable or 0:15:09.680 --> 0:15:13.560 satellite provider. Other than they're the ones who provide the 0:15:13.560 --> 0:15:16.800 actual pipes that get the data there or tubes if 0:15:16.800 --> 0:15:22.320 you prefer, since that's what the and in two thousand fifteen, 0:15:22.440 --> 0:15:24.280 and I think, I know you're thinking, wait, whoa what 0:15:24.560 --> 0:15:29.160 two thousand fifteen, But it's not even yet there. There 0:15:29.400 --> 0:15:32.080 is an estimate, Yes, there's a prediction. The mp D 0:15:32.280 --> 0:15:35.160 group estimates that the average pay TV cable bill in 0:15:35.200 --> 0:15:38.080 two thousand fifteen will be and prepare yourselves for some 0:15:38.120 --> 0:15:41.080 sticker shock, a hundred and twenty three dollars per month. 0:15:41.120 --> 0:15:45.240 That's average, meaning that they're gonna be other packages out 0:15:45.240 --> 0:15:47.160 there that are going to be significantly more than that, 0:15:47.280 --> 0:15:50.520 and some that will be less than that three bucks 0:15:50.560 --> 0:15:54.400 per month. Yeah, so that's our timeline. But we've got 0:15:54.400 --> 0:15:57.320 a full discussion about cord cutting coming up, and before 0:15:57.360 --> 0:16:01.880 we do that, let's take a quick break to our sponsor. Okay, 0:16:01.920 --> 0:16:05.840 so we've covered kind of the timeline of cable and 0:16:05.920 --> 0:16:08.960 what's going on with this chord cutting trend. We should 0:16:09.000 --> 0:16:12.160 stress again this trend, if it is in fact a trend, 0:16:12.720 --> 0:16:15.000 is still in its earliest days, and in fact, there 0:16:15.000 --> 0:16:18.400 are a lot of factors that complicate the decision to 0:16:18.880 --> 0:16:22.480 just cut the chord, and it all will depend upon 0:16:23.000 --> 0:16:26.160 the individuals preferences like what what do they like to watch? 0:16:26.200 --> 0:16:29.240 Because some things, if you like certain things, you know, 0:16:29.320 --> 0:16:33.000 you need to have cable, you know, certain sporting events. 0:16:33.360 --> 0:16:35.640 That's a big one. Sports is like the biggest one 0:16:35.680 --> 0:16:41.200 because sports companies have very complicated television deals. And anyone 0:16:41.200 --> 0:16:44.720 who's tried to follow sports and has also looked at 0:16:44.760 --> 0:16:47.600 cutting the cable or cutting the chord has found out 0:16:47.640 --> 0:16:50.320 that this can get pretty complicated. Yeah. I've had a few, 0:16:50.440 --> 0:16:55.280 um international football fans who who soccer fans for US folks, 0:16:55.360 --> 0:16:58.160 um that that you have to gote like like, well, 0:16:58.280 --> 0:17:00.960 I can't I can't do this because this, Yeah, because 0:17:00.960 --> 0:17:03.320 then I can't see anything or you know, I I 0:17:03.360 --> 0:17:06.520 am a casual baseball fan. But the way that baseball 0:17:07.440 --> 0:17:11.840 agreements work on television and cable means that if I 0:17:11.880 --> 0:17:15.879 were to go with an online solution, like I I 0:17:15.960 --> 0:17:21.920 subscribe to Major League Baseball and get get games through there, 0:17:22.440 --> 0:17:25.359 there's still some agreements that say that if a game 0:17:25.480 --> 0:17:28.080 was to be shown in my local area, it cannot 0:17:28.080 --> 0:17:30.399 be shown on the internet, which means that if I 0:17:30.440 --> 0:17:33.320 don't have that access, then I don't see that game. 0:17:33.680 --> 0:17:35.560 So clearly sports is one of those things that if 0:17:35.560 --> 0:17:39.000 you're a big sports fan, there are really very few 0:17:39.040 --> 0:17:42.160 options that will satisfy you entirely. Not that there aren't 0:17:42.240 --> 0:17:43.920 options out there. There are a lot of them. They're 0:17:43.960 --> 0:17:47.760 just not gonna necessarily meet your needs. So let's talk 0:17:47.880 --> 0:17:53.439 more about this whole cord cutting cable subscription problem. So 0:17:53.520 --> 0:17:56.560 cable subscription growth has kind of wobbled, like we had said, 0:17:56.600 --> 0:17:59.240 it dips a couple of times, it's kind of held 0:17:59.280 --> 0:18:03.920 steady more less in about totally. If you're talking about 0:18:03.960 --> 0:18:07.280 pay TV subscriptions, not just cable, but pay TV subscriptions 0:18:07.320 --> 0:18:11.320 across all the providers are about a hundred point eight 0:18:11.440 --> 0:18:16.240 million customers. But the number of occupied households grew. Yeah, 0:18:16.359 --> 0:18:19.440 so you get one point to five million more households, 0:18:19.440 --> 0:18:23.199 but the actual subscription numbers stay steady. This tells you 0:18:23.240 --> 0:18:26.800 a couple of things. It tells you there's some combination 0:18:27.119 --> 0:18:31.359 of new households that are not subscribing to cable, or 0:18:31.400 --> 0:18:34.040 if all one point to five million people are subscribing 0:18:34.080 --> 0:18:36.320 to cable, that means you lost one point to five 0:18:36.359 --> 0:18:40.280 million existing customers because your numbers stayed the same. So 0:18:41.320 --> 0:18:45.000 there's some and there's it's more likely a combination right, 0:18:45.040 --> 0:18:47.040 there's some people who just said I don't need it, 0:18:47.040 --> 0:18:48.560 so I'm never going to get it, and there's some 0:18:48.600 --> 0:18:50.960 people who are like, I want it, and then some 0:18:51.080 --> 0:18:54.400 existing customers saying I am not doing this anymore. So 0:18:55.320 --> 0:18:58.200 the with the numbers staying steady, that's you know, everyone 0:18:58.240 --> 0:19:00.159 wants to see growth when they're in a business. They 0:19:00.200 --> 0:19:02.640 want growth year over year, and they want that rate 0:19:02.640 --> 0:19:07.159 of growth to grow in turned. So, now, according to 0:19:07.200 --> 0:19:10.640 the Multi Media Research Group, there are about eighty four 0:19:10.720 --> 0:19:14.280 point five million pay TV subscribers in the United States 0:19:14.320 --> 0:19:18.399 in and cable accounts for forty eight point seven of 0:19:18.400 --> 0:19:22.360 that number. Satellite was another forty point four percent, and 0:19:22.400 --> 0:19:24.679 then you have I p t V, which was ten 0:19:24.760 --> 0:19:27.800 pot nine. Now, like we said, out of all of 0:19:27.800 --> 0:19:30.200 those three, ib TV had the biggest amount of growth, 0:19:30.240 --> 0:19:33.199 but it was also the smallest number of customers. Right, 0:19:33.640 --> 0:19:37.320 So really, you know, a significant growth for ip TV 0:19:37.480 --> 0:19:40.720 would be insignificant for cable or satellite, is what we're saying, 0:19:40.720 --> 0:19:43.119 because just because of the numbers game and boy aren't 0:19:43.119 --> 0:19:47.840 percentages fun And we don't really know a lot about 0:19:47.880 --> 0:19:51.920 people who just don't ever subscribe to cable, Like there 0:19:51.960 --> 0:19:57.000 there's a generation now that's entering into their first living 0:19:57.000 --> 0:20:01.760 away from home. That ver so the millennia alls and younger. Yeah. Yeah. 0:20:01.840 --> 0:20:04.800 Charlie Organ, who's the chairman co founder of the Dish Network. 0:20:04.960 --> 0:20:07.119 At UM the Dive into Media conference, which is a 0:20:07.160 --> 0:20:11.960 big executive kind of thing that happens every year, was 0:20:12.000 --> 0:20:14.480 talking about, um, you know, the fact that that college 0:20:14.560 --> 0:20:17.800 kids don't subscribe to cable packages when they're in college 0:20:18.160 --> 0:20:21.240 because they've got broadband at school and cable is expensive, 0:20:21.480 --> 0:20:25.040 and then they're getting out into maybe the workforce or 0:20:25.160 --> 0:20:27.520 maybe they're having trouble and they're continue and that they're 0:20:27.520 --> 0:20:30.080 just never going to buy it. He joked, there's a 0:20:30.119 --> 0:20:33.800 reason that tobacco companies giveaway free cigarettes at colleges. Wow, 0:20:34.480 --> 0:20:38.199 what a great joke. Boy. I sure wish I had 0:20:38.200 --> 0:20:40.600 said something like that to be recorded for all time 0:20:40.680 --> 0:20:45.000 on the internet. He said sarcastically. Um, yeah, so we 0:20:45.080 --> 0:20:48.240 don't really know how many people don't subscribe, because I mean, 0:20:48.280 --> 0:20:50.680 these these are numbers that don't tend to get counted 0:20:50.760 --> 0:20:54.840 in surveys. Yet again, it's difficult to record something not happening. 0:20:55.080 --> 0:20:57.119 But if it does mean that there are more and 0:20:57.160 --> 0:21:00.879 more people who are never becoming so subscribers either to 0:21:00.960 --> 0:21:03.679 cable or IPTV or SATURDAYLA or whatever, and they're just 0:21:03.760 --> 0:21:07.360 relying on other services, things like the streaming services will 0:21:07.359 --> 0:21:10.439 talk about in our companion piece, or just you know, 0:21:10.520 --> 0:21:13.639 anything that they can get online. If if that's a 0:21:13.680 --> 0:21:17.679 growing trend, that's bad news for providers, all right, especially 0:21:17.720 --> 0:21:21.080 because over this period of time, broadband subscriptions, you know, 0:21:21.160 --> 0:21:25.440 people who are who are purchasing plans to get broadband 0:21:25.480 --> 0:21:28.080 into their home are on the rise. Yeah. Yeah, the 0:21:28.080 --> 0:21:32.080 cable television portion of it is in decline. So there 0:21:32.160 --> 0:21:35.040 is some worry within the cable industry, particularly in the 0:21:35.040 --> 0:21:38.280 cable providers and satellite providers, that what they are going 0:21:38.320 --> 0:21:41.120 to end up being will be don't what they call 0:21:41.240 --> 0:21:44.960 dumb pipes, meaning that they'll just they'll just provide that 0:21:45.000 --> 0:21:48.040 connection that Internet connections, So you'll still subscribe to have 0:21:48.160 --> 0:21:51.640 the Internet connection, you'll still subscribe for a monthly plan 0:21:51.760 --> 0:21:55.200 on that. But that would be what the cable companies 0:21:55.240 --> 0:21:59.000 could turn into. If you're looking well into the future 0:21:59.000 --> 0:22:02.160 and assuming that these trends are one reel and two 0:22:02.240 --> 0:22:05.600 going to continue, which by the way, is still really early, 0:22:05.920 --> 0:22:07.960 and there are a lot of things that cable companies 0:22:08.000 --> 0:22:11.680 can do to either address this issue or at least 0:22:11.680 --> 0:22:16.359 make it last longer. Huh. And we'll talk about a 0:22:16.359 --> 0:22:19.640 little bit of that, but uh, we don't know what's 0:22:19.840 --> 0:22:21.920 how it's going to turn out. So I know a 0:22:21.960 --> 0:22:24.080 lot of people kind of have this foregone conclusion that 0:22:24.800 --> 0:22:27.639 cable companies are are on the way out. It's just 0:22:27.680 --> 0:22:29.840 a matter of time. People for the past four years 0:22:29.840 --> 0:22:31.879 have been saying it is the end of television as 0:22:31.960 --> 0:22:35.480 we know it, and that gets complicated, I mean, because 0:22:35.560 --> 0:22:39.359 when you're talking about this whole system going away, it 0:22:39.480 --> 0:22:43.600 changes everything about the entertainment industry and the television industry 0:22:43.640 --> 0:22:45.359 and the way that all of these contracts are drawn 0:22:45.440 --> 0:22:47.359 up and where the money goes and who gets how 0:22:47.400 --> 0:22:49.360 much of it right, and whether or not we ever 0:22:49.480 --> 0:22:53.959 get another awesome, well produced television series or if everything 0:22:53.960 --> 0:22:56.879 has to become something on the cheap because suddenly the 0:22:56.920 --> 0:22:59.920