Garcia Media Life

Is Pay-TV going the way of the dinosaurs?  High unemployment, rising costs, poor service and increasing on-line viewer choices have officially begun to put a dent into the Pay-Television business.  For the 1^st time ever, the numbers of subscribers to cable TV, satellite and telecom services are down.

It’s not all economic, but this lingering recession may have been the match that started the forest fire.  It’s not hard to figure out.  When you get home after HR has just handed you your walking papers and you sit down to do your new jobless budget- what’s one of the first things to go?  Cable.  Satellite.  Fios.  

But everybody manages a way to keep their internet access.  Hello Hulu. Hello Netflix.  Play Stations, Wii’s and X-Box’s put the shows and movies you want to watch on the big TV; the lap-top does the same and also serves as the portable alternative.  

I say it’s only partly economic because it isn’t just the ever-increasing monthly bills for Pay-TV services that rub people the wrong way.  Folks with dishes are fed up with losing their service every time it rains or the wind blows.  And the only time anyone actually wants to watch a commercial is when the Super Bowl’s on.  The old lament of 500 channels and nothing to watch is truer than ever; it is amazing the amount of drivel on cable/satellite/fios these days.

I would expect battles, particularly between cable companies and content-providers to escalate into full-blown wars.   Pay TV is not in a position to keep pricing customers into oblivion.  They are going to have to reduce the costs of their services to consumers if they’re to remain viable.  More and more they will have no choice but to stand up to TV and Cable networks and their increasingly exorbitant demands for increases in their percentage of cable subscriber fees.  As their game of chicken continues, inevitably, one or two or three networks just won’t be available on some cable systems anymore.

Somebody is going to have to figure out how to innovate their way out of this spiral, but I think it has definitely begun and you can mark the 2^nd quarter of the year, 2010 as the moment Pay TV began its descent.   The full implications of it all are mind boggling. 

But if someday CNN, Fox and MSNBC disappear- somebody’s going to have to tell me about it because it will have been years since I watched that crap.