The Death of Cable  

A blog about business and economics.
May 20 2013 4:32 PM

Cable Is Dying, But Is It Losing to Cord-Cutters or to Fiber Optics?

screenshot-2013-05-20-at-9-53-39-am-e1369068910567_1

Above you'll find the Leichtman Research Group's analysis of what's happening in the multichannel pay television ("cable") market over the past quarter and the past year. Basically, cable companies are bleeding subscribers. Janko Roettgers at Gigaom seems convinced that we are at last seeing the rise of the cord-cutters.

I think the picture is quite a bit less clear than that. If you look at the past year, there's been a net reduction in the number of people subscribing to pay television. But if you focus on the last quarter, high-end fiber optic services from Verizon and AT&T have grown faster than cable has shrunk. The yearlong view supports the idea that cable is losing out to the cheaper alternative of cord-cutting, but the quarterly view suggests that cable is losing out to high-end competition from fiber. That those two interpretations are out there only underscores the extent to which the cable industry is in long-term decline faced with competitive threats on both sides.

Advertisement

Something to note if cord-cutting does continue to gain traction is that although you can save a lot of money by canceling your cable right now and just getting broadband (this is what my wife and I do right now), if everyone drops television service, it's likely that the price of broadband will rise a lot to compensate. Just as a la carte won't fix cable, cord-cutting won't really fix it either. The issue is that there's a lack of competition in the industry and every different approach to regulation you can think up has serious problems associated with it.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

TODAY IN SLATE

Politics

Meet the New Bosses

How the Republicans would run the Senate.

The Government Is Giving Millions of Dollars in Electric-Car Subsidies to the Wrong Drivers

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Cheez-Its. Ritz. Triscuits.

Why all cracker names sound alike.

Friends Was the Last Purely Pleasurable Sitcom

The Eye

This Whimsical Driverless Car Imagines Transportation in 2059

Medical Examiner

Did America Get Fat by Drinking Diet Soda?  

A high-profile study points the finger at artificial sweeteners.

The Afghan Town With a Legitimately Good Tourism Pitch

A Futurama Writer on How the Vietnam War Shaped the Series

  News & Politics
Photography
Sept. 21 2014 11:34 PM People’s Climate March in Photos Hundreds of thousands of marchers took to the streets of NYC in the largest climate rally in history.
  Business
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
  Life
Quora
Sept. 22 2014 8:07 AM Why Haven’t the Philadelphia Eagles Ever Won a Super Bowl?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Science
Sept. 22 2014 8:08 AM Slate Voice: “Why Is So Much Honey Clover Honey?” Mike Vuolo shares the story of your honey.
  Arts
Television
Sept. 21 2014 9:00 PM Attractive People Being Funny While Doing Amusing and Sometimes Romantic Things Don’t dismiss it. Friends was a truly great show.
  Technology
Future Tense
Sept. 22 2014 7:47 AM Predicting the Future for the U.S. Government The strange but satisfying work of creating the National Intelligence Council’s Global Trends report.
  Health & Science
Bad Astronomy
Sept. 22 2014 5:30 AM MAVEN Arrives at Mars
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.