Cable TV operators’ rate of decline in Q1 reached -9.9% year over year, while satellite providers DirecTV and Dish Network fell -13.4%. In addition, so-called “virtual MVPDs” (multichannel video programming distributors) lost 264,000 customers in Q1, among the worst quarters to date for the segment.
“The picture is not one that suggests that a plateau in the rate of decline is coming any time soon,” Moffett wrote.
It is no surprise that I cut the cord years ago, but two things make me debate that decision every year, live sports and local TV news. I’m a transplant to Baltimore, so my team, the New Orleans Saints, is only available if I pay a ridiculous cost for the NFL’s Sunday package. As the team grew in national fame, I spent more but still could not watch big national games or occasional Baltimore Ravens vs. New Orleans Saints matches because of antiquated TV rights rules.
In New Orleans’s I know local TV news like the back of my hand, but as a cord cutter, I can’t tell you a thing of Baltimore’s local stations. Why is this when it seems clear that traditional TV has lost the war? Why do holdouts like the local news and sports continue to make it hard to take the leap?
In 2022, Forbes reported that “Streaming Viewership Surpasses Cable For First Time, Nielsen Says.”
While streaming will likely remain the dominant form of television consumption, Fuhrer told Forbes that broadcast and cable will likely “see some rebound” this fall, as college sports and the NFL season start up and attract a higher share of viewership to those mediums.
Outside of the NFL and college football, every other sport has embraced streaming and has worked to make watching games more accessible. American football is stuck with a problem, few companies are big enough to lay out the dough they require, and until then, football has dug in and embraced traditional TV.
TV news is different but similar. News is stuck with an unclear business model in streaming, but something that, while declining, still pays. CNN pushed hard to grow its online news business only to scale back drastically. Other broadcasters skirt the concept but struggle with reducing the size of their audience or being limited to building their distribution systems. So while traditional TV holds on for dear life to maximize profits and return shareholder value, these companies continue to miss the entire point.
In 2018 the Guardian reported that “Young people are not watching TV news, but they still want to know about the world,” and why wouldn’t we expect that when in 2012, the Holly Wood Reporter spoke of these issues in “Why Kids’ TV is Scrambling to Stay Afloat“.
Despite the effort, Nickelodeon and others increasingly compete with their own content on Netflix as their parent companies eagerly make rich licensing deals. In early May, Bernstein analyst Todd Juenger issued a report blaming “drastic declines” in ratings for kids networks in part on repeats of older episodes in homes that subscribe to the streaming and DVD service. The study was controversial because it was based only on data from homes that subscribe to TiVo, which is not necessarily typical of the broad universe of TV homes, but Juenger says “executives should think hard whether they want to sell this content to Netflix. The money looks good in the short term, but if you believe what the data says, as Netflix gets more subscribers and people who use it more get accustomed to it, the impact is going to grow.”
Local TV, cable news TV, and football are getting the profits today, but both are missing out on establishing a relationship with a digital-first generation they’ve chosen to ignore or force to meet them on their turf. As Netflix begins its cord-cutting tour, do not forget Netflix CEO Reed Hastings’ quote on who they compete with:
“We earn consumer screen time, both mobile and television, away from a very broad set of competitors,” the quarterly earnings statement read. “We compete with (and lose to) ‘Fortnite’ more than HBO.”
What will the next generation pick when deciding between Roblox, Fortnite, and the NFL? Guess we will find out.