Will the Internet Replace Cable TV?

When friends and neighbors seem to get better and more TV than you do without paying for cable, it’s easy to feel

left out of the media loop. “Leaving something out” is exactly what more viewers are choosing these days – they’re

cutting the umbilical cord to their cable TV subscriptions.

Viewers are spending more time taking in media than ever before, according to a 2012 year-end media report from

Nielsen, but they aren’t necessarily using their TVs to do so. People are accessing their entertainment programming

via the Internet and on mobile devices, at home and on the go. The Nielsen report shows viewers are choosing both

live and recorded shows and both free and paid content.

The Second-Screen Experience

But if viewers are so busy unplugging from traditional cable TV, how is it that TV is managing to nudge open the
door

to a new social TV era? The rise of the second-screen experience, where viewers interact with a show’s content and

each other on social media via a tablet or smartphone, is the force at work here.

“I would say the biggest shift in the last two years is that the [second-screen] experience used to be layered on to

the program as an aftereffect,” David Anderson, senior vice president and head of digital at Shine America, said at

the International Consumer Electronics Show 2013. “But now when we go into a network pitching a show, we go in

there with components that might be a creative fit… We view them as part of show.”

Indeed, just last month ESPN Deportes debuted #Redes, a show it calls the “first live multi-screen viewing experience

geared towards the bilingual Hispanic sports fan.” Show topics are drawn from social media trends spotted on

Twitter, Facebook, YouTube and other social media, with data and content presented as part of the show’s

interactive material.

The Cart or the Horse?

Some thought leaders believe that TV, not the digital social media element, is the hot factor in the social media

equation. “Live television is more vital a platform than digital and new media,” said Mark Cuban, president of cable

network AXS TV, at the January 2012 NATPE/Content First conference.

“Television has a huge advantage in the social media world … Now viewers are sitting with devices on couches –

tweeting, posting on social media, and using television as instigator for all of that. TV is a starting point for

conversations. When you watch TV, you are getting a unique experience that you can’t get online.”

Cuban described must-see events and programming as the key to bringing cable back into the social TV loop. “If you

want to watch that Tiesto concert, or the Skrillex concert… or the Jay-Z concert live on AXS TV,” he said, “you’ve
got

to get cable. If you want to be part of the conversation that all your friends with cable are part of on [social media],

you’ve got to have cable.”

Between a Bundle and a Hard Place

While many consumers are hoping for a day when they can buy the channels and shows they want à la carte, Cuban

denied that bundled plans will decline in popularity. “À la carte would make it so expensive for the consumer that

you would just kill television,” he said. “People like bundles. People don’t want to have to work for their

entertainment. You pay a premium for it because it saves you time.” According to www.cable.tv, he’s right; all the

major cable providers offer viewers bundling options that enable them to purchase multiple services together.

Still, pulling the plug on cable doesn’t seem to be inconveniencing those who are giving it a try. “We ditched costly

TV a year and a half ago and don’t miss it at all,” commented Atlanta-area resident LC on a blog post at the Atlanta

Journal-Constitution. “We have an antenna for football games and occasional news and pay for Netflix and Hulu

subscriptions also. We watch TV when we want and don’t feel like we are missing anything.”

For many, the concern is less about what they might be missing without cable than the perplexing conundrum of

pricing bundles that run higher for Internet alone than with cable. “We tried to cancel our cable, but the cost to have

Internet alone would end up costing us something like $23 more a month than we currently pay for both Internet

and cable,” wrote reader WK in the article’s comments. “We have to have fast, reliable Internet since my husband

works from home.” Users trapped by bundle pricing predicaments are making do with slower service tiers (often

sufficient for streaming) and using cell phones as mobile hotspots.

When consumers do miss their old broadcast channels, they’re increasingly turning to an old standard: broadcast TV.

Nielsen reports that while exclusive over-the-airwaves TV viewership was falling by 16 percent back in 2003, that

retreat slowed to just 9 percent in 2012, as viewers discovered that an antenna costs about $25 and can provide as

many as 40 channels entirely free.

Traditional Cable TV is Still in the Game

While the media continues to trumpet the growing influence of social TV, with more viewers disconnecting from

cable and seeking an à la carte media experience, it might be more accurate to characterize this transition as a time

of rugged individualism. Consumers are riding out the end of the cable era as they search for content that’s more

interactive and increasingly social, driven by a desire to pinpoint and share the specific content they want.