Cable companies struggle to keep up with millenials, online streaming

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Kirin Daniels/The Cougar

If someone under the age of 35 is watching their favorite television show, chances are they’re not tuning in during the show’s live transmission. The way younger viewers access media is rapidly changing the television marketplace, and subscription TV providers are feeling the pain.

Big changes are afoot and the nascent transition from broadcast to streaming media is being led by tech-savvy millennials that desire only the content they want to see, when they want to see it. The lower and upper limits of this generational division are not strictly defined, but the term generally encompasses those born between the years 1980 to 2000.

According to Poynter, a third of millennials mainly watch online videos and no broadcast TV. This means big trouble for cable and satellite companies.

Subscriptions are down and with each passing month more people are choosing to “cut the cord.”

Bloomberg reports that pay-TV providers collectively lost a quarter of a million subscribers in 2013. It may not seem like a big figure, but this number has greater implications than subscribers alone — this was the industry’s first full-year decline.

The image of a family crowded around the television glow in a scene resembling a Rockwell-like portrait of American life is quickly fading from view.  Rather than watching traditional broadcast TV, younger viewers are streaming media on their phones, tablets or laptops, which allows a level of flexibility that cannot be matched by broadcast providers.

“Online streaming is where it’s at,” said kinesiology senior Manuel Martinez. “It’s easier because you can watch wherever there’s Wi-Fi, and Wi-Fi is everywhere.”

Cable companies try to capture this flexibility by offering the option of wireless receivers so that a user’s TV can be moved anywhere in the house. This indicates that although providers are trying to understand the needs of their subscribers, they just aren’t there yet. No one wants to be able to carry their fifty-inch TV to locations as ridiculous as one’s front porch, as depicted in commercials. What’s more likely is that a show is started at the breakfast table, continued during a lunch break and later finished in bed, all on a number of devices.

Part of the allure of streaming content for millennials isn’t just flexibility; it’s a matter of economics. Whether parents would like to admit it or not, young people are pretty thrifty and the expense of cable TV just isn’t something that makes sense to the younger generation.

For example, theatre education sophomore Ryan Barret said he recently moved into a house near campus with friends. During a meeting to discuss finances, the roommates were all in agreement that none of them wanted subscription television.

“We all felt that it is kind of pointless to pay for cable when you’re already paying for internet,” Barrett said.

The notion that subscription television is unnecessary when one has internet access is the sentiment of a generation, and it’s a sentiment unlikely to change. With a broadband connection, one can stream much of the content available through traditional subscription providers. Options like Hulu and Netflix, both under $10 a month, make it possible to watch one’s favorite shows and movies without breaking the bank. Add Amazon Prime to the mix and suddenly you’ve got the streaming trifecta.

Or, for the truly frugal, pay for one and exchange passwords with friends that have the other two. Ethical considerations aside, this combination of services commonly known as “hipster cable” allows for the feel of having cable TV without the expense.

For pay-TV providers, the writing has been on the wall since 2012 when Netflix took Comcast’s title as America’s largest subscription service. How each chooses to respond to such industry-altering milestones will ultimately decide its staying power. Some companies are holding out hope that millennials will eventually come around, while others are finding new ways to entice them.

Executives at the premium cable network HBO feel that once college students “grow up and settle into better-paying, 9-to-5 jobs, they are more likely to add HBO to their cable packages.” This is an assumption predicated on the belief that millennials will have cable or satellite subscriptions to begin with, which doesn’t seem likely.

While HBO waits for a day that may never come, Dish Network is actively pursuing new ways to attract the demographic that is changing the marketplace.

Charlie Ergen, the company’s founder and chairmen, acknowledges that they are “losing a whole generation of individuals who aren’t going to buy into (the pay-TV) model.” To this end, Dish is creating a limited “virtual cable” package which will provide millennials with the web-based content they want at a cost they can afford.

Whether or not millennials will be responsible for the “death” of traditional subscription television remains to be seen, but the viewing habits of those under 35 have certainly caused some heavy bleeding in the industry. What’s clear is that it’s time for those in the pay-TV business to recognize that the tide is turning before it’s too late.

Opinion columnist Jonathon Bolan is an English graduate student and may be reached at opinion@thedailycougar.com.


Cable companies struggle to keep up with millenials, online streaming” was originally posted on The Daily Cougar

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