Cord Cutting and Disruption

No one could have predicted 10, 20, or 30 years ago that in 2014, TV would be on its way out, newspapers would be struggling to stay alive, that we would carry powerful cell phones and mobile devices that fit in our pocket. Nor, in many ways, are we able to know with great certainty what the future will hold. We can speculate on the future of the trends we discuss, but it is difficult to know what great idea will emerge or catch on. It is amazing to think of some of the innovative possibilities.

I am fascinated that companies, big and small, are able to disrupt norms by innovating and “changing the game” – sometimes even fundamentally changing the way that we live our lives.

One technology trend worth paying attention to is the shift in traditional television and entertainment viewing.

I recently heard a new term “Cord Nevers”. Not only do we have a large population that are choosing to no longer subscribe to paid satelite or cable television (“Cable Cutters”), but we also have a generation of younger, tech-savvy consumers who havenever before paid for cable, and are not be able to justify the steep expense.

Cord Cutting

For this group (of which I am a member), when the power of a high-speed internet connection is combined with the popularity of smartphones and tablets, downloading full-episodes and other free or paid content online makes more sense.

Could the cable television industry go the way of the land-line telephone service provider or the newspaper industry? Is there a significant decline ahead as consumers change the way they view media content?

In response to industry changes, outgoing Time Warner Cable CEO, Glenn Britt said in 2013:

“I think the cable industry as a whole was in denial that we had real, viable competitors. And certainly, each of them has strengths and weaknesses, just as we do. However, they are around to stay, and we need to keep getting better at competing.”

A few key factors are at play here:

  • Services like Netflix, Hulu, Amazon Instant are not only delivering content to consumers, but some have begun a new trend producing their own original content.
  • Products like Roku, Apple TV, and Google Chromecast allow media- viewers to purchase TV shows and movies in digital format and view on th eir television. These products also allow viewers to mirror streaming content from their mobile devices to their TV sets.
  • Mobile devices are really the ones stealing the show. People are spending more time on cell phones and tablets, and less time watching TV.

In the end, will cable companies be able to survive if they don’t adjust to industry and lifestyle trends?

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