Cable And Satellite Television: Hard Times Call For Hard Decisions
By Janet Peterson on May 3, 2010, 6:00 am Posted in Finance NewsYankee Group recently released the results of a survey of pay television providers and more than 6,000 U.S. based consumers. The study shows that at least 1 in 8 will at the very least scale back their level of service, and many will end it completely. In most cases the decision will be economically motivated, but not all. There are replacements for the service that many find just as satisfactory.
The Number 1 Reason Is…
You guessed it, expense. At present subscribers are paying an average of $71 every month. Add an annual 5% rate hike to be expected every year and the cost will go up quickly. Also notable is that more broadcasters are charging the cable and satellite providers, this helps to drive the price increases. Recently Fox Network, Sunflower Broadband, Time-Warner, and others pressed issues that were resolved by higher fees being paid to the networks. That fee had to be absorbed somewhere.
Increasingly…The Internet
In the end, the availability of entertainment and streaming video on the internet is becoming the replacement. Sports fans may be moved a little slower, but even in that area, more is becoming available on the internet. According to comScore, an internet data tracking company, last count said that there were 180 billion watchers, that watched 31 billion videos last month, and this figure doubles the figure from 1 year ago.
Ready For More Pay Per View
If you haven’t already tried it Netflix (NFLX) offers a streaming service as does a company called Hulu. Both of the companies have recently reported an increase in their online activities. One website, Justin.tv is becoming an almost overnight sensation. They boast a complete offering of live network news, regular network channels, as well as public access broadcasts.
Satellite and cable television service providers need to start watching their fees and the cost of their service, they could easily become a luxury again, like they were in the early 80′s.
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Paid for television channels can be expensive and with an increasing amount of free channels online I am not surprised people are cutting back wherever possible.
Hard Decisions? Perhaps they should create a unit that combines Internet TV with Cable programming and provide it at an affordable cost with free equipment. Or, they can ignore the signs and begin down the road to the end. I dropped cable almost 2 years ago and have saved nearly $6000 since. Well worth it.
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