Goodbye, Cable TV. So Long, and Thanks for All the Fish.

cable TV

Back in 2003 I co-wrote a scientific paper about Video-on-Demand. At the time it was a hot topic in computer science and I would never have expected that it would take almost ten years for the technology to become mainstream. But now it is here, and it is drastically changing the industry. Once you’ve tasted VoD, there is no coming back. Only real-time events (mostly sports, news, and some entertainment like the Oscars) are still worth watching live. Cable companies have been slow to react and their on demand content offering is still limited. Will they be completely superseded by internet television and die like Blockbuster did? I believe that the threat is real. Netflix just had its biggest year yet, with the company reporting that it added 11 million subscribers in 2013, the highest yearly net add to date.

On the other hand the pay-TV industry has reported its worst 12-month stretch ever in 2013. All the major TV providers lost a collective 113,000 subscribers in Q3 2013, including internet subscribers. Nearly 5 million cable TV subscribers have gone elsewhere in the last five years, and for the first time the number of TV subscribers at major U.S. providers has fell below 40M. This downward trend also applies to major TV events such as the World Series and the NBA finals. Dish is so desperate that it is giving free iPads to new customers. Cable unbundling, coming this year to Canada, is certainly not the solution for cable companies and, in my opinion, will only compound the problem.

I am now amongst the chord cutters. It all started when I had my first child and started an MBA three weeks later. Before that, I used to open the TV pretty much as soon as I got home from work, and it would play until I went to bed. I had so many channels that at the start of the hour I would start cycling them to find something interesting, but the next thing I knew was that it was half past and I had to start the process all over again, wandering aimlessly and frying my brain. Sometimes it would end up in marathons of Storage Wars or Property Virgins. I was watching every single Habs games from start to finish. But then the child came and the TV was gone. It helped that we put it in the basement where we don’t often go. After a year of paying all these channels for nothing, I called my cable provider and downgraded to the most basic package. Then a couple of months later I cancelled everything, to the dismay and disgust of the retention department, and got myself an antenna on Kijiji. I was now free! And my child, instead of developing future ADD issues watching baby Einstein, was playing with construction blocks, wooden puzzles, and books. All was well.

But not entirely. You see, I had the immense luxury of not having a cellular phone until recently. And then I bought a smartphone. I read a lot more books and magazines, but a lot of my leisure time also shifted from TV to mobile. And it looks like I am not the only one…

going to mobile

Deloitte predicts that by the end of 2014, two-and-a-half-million Canadian households will actually have multiple television subscriptions and that their number will be more than 100 times greater than the number of households which have cancelled their subscription. With family telecommunication bills (TV, internet, telephone) in the order of 100-200$ per month and record consumer debt levels in Canada, I really don’t believe that people will be adding more services on top of existing ones. According to Deloitte, the 20 per cent of Canadians watching the most TV will be spending more than eight hours a day staring at the screen in 2014. This is hard to believe, but maybe I am just an outlier data point.

I am still watching TV on rare occasions. I’ll watch the Super Bowl next week-end and the chances are high that I will be tempted by the Olympics. But for me, leisure time will never be the same. Now, the next step is to replace some of that ‘mobile’ time with board games, hiking, and playing outside with the family…

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