The future of cable TV is uncertain as more (especially young) viewers are cutting expenses and are choosing cheaper streaming platforms such as Netflix, Disney+ and Amazon Prime. In April, streaming platform Netflix announced the introduction of their new lower priced ads-supported subscription plan next to their already existing ads-free subscriptions. Furthermore, streaming platforms nowadays offer more and more similar-like content (e.g., reality shows) as what is shown on cable TV. What impact on traditional cable TV is expected with this new type of streaming-subscriptions and its expansion to similar-like content?
First, it is expected that cable TV advertisers switch to advertising on streaming platforms. Streaming platforms make it attractive for advertisers to switch their way of advertising from cable TV to streaming platforms. Advertising on streaming platforms simply make it possible to reach more customers with the ability to reach all screen types (e.g., TV, tablet, mobile). Besides, it is more affordable and streaming platforms allow advertisers to control the ad content and collect personal data of viewers which helps advertisers to get to know their target audience. These advantages make it highly attractive for advertisers to switch to advertising on streaming platforms.
Second, it is expected the number of cable TV subscribers will drop even further. The COVID-19 pandemic made people revision their monthly spending and cut expenses. Besides, with inflation impacting the spending of households worldwide, consumers are looking for the cheapest ways to enjoy watching content. Because cable TV contains high monthly costs and lack of live sports, it is shown in 2020 that one in three US households have already cut the cord on their cable TV and have moved to streaming platforms. Past July (2022), the streaming services even captured more viewers than cable TV and this is expected to increase further in the upcoming years. With the introduction of cheaper ad-supported subscription of streaming platforms and its similar-like content with cable TV, it is therefore expected that the price-conscious consumers are cord-cutting their cable TV and switch to streaming platforms.
In conclusion, with the introduction of the ad-supported subscription models on streaming platforms, streaming services continue to have a crushing impact on the traditional cable TV industry. The new subscription model is expected to let advertisers switch to streaming platforms and attract new subscribers which were first subscribed to cable TV. It is likely for the cable TV industry to be disrupted in the near future if no drastic changes are made in its strategies. What do you think? Do you still have a cable TV subscription?
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