THERE YOU HAVE IT column: Things aren’t cool with cable TV
by Ted Carter
Published: January 15,2012
In my little world, Comcast choked as bad last Monday night as LSU did in getting rolled by Alabama in college football’s national championship showcase.
I would loved to have watched the game in the comfort of my living room but Comcast fixed things to make sure I didn’t.
My neighbor and his buddies in the apartment below had a grand old time watching the big game (Tide fans?). I was glad for them and still am, even though I found out later that the Comcast guy who turned on the neighbor’s service last Monday inadvertently cut off mine.
That marked my fourth outage that required repair since early November.
Comcast, the cable god, giveth and taketh away.
And more and more customers are saying take it away. Junk it. I don’t want it.
It’s been 35 years since Ted Turner proclaimed he was cable before cable was cool.
But cable is getting considerably less cool.
Four decades ago, Americans were inclined to put up with interrupted service and dashed hopes for a night or weekend of television entertainment. Not so much anymore. Not when new whiz-bang entertainment technologies are making cable television seem a lot like yesterday’s news.
Jon Orlin, in a year-old New York Times article titled “Internet TV and The Death of Cable TV |Cable” argued it’s way too early to predict the demise of cable TV. But Orlin did note that cable video alternatives are moving from technologies only early adopters use to ones the broader market can figure out.
The cable television giant lost 238,000 video customers in the second quarter of 2011 and 165,000 in Q3. Third quarter losses came in below estimates, but you don’t expect to lose customers unless something is not right with either you or your product.
The story is the same industry-wide. Cable TV companies in the United States lost a record 711,000 subscribers in the second quarter of 2010, and six of eight operators suffered their worst quarterly subscriber losses ever.
Losses by cable providers are usually offset by stronger growth in satellite providers. That didn’t happen in this instance, reports Gigaom.tv, a website that chronicles trends and advances in digital entertainment.
Comcast and other cable providers are indifferent to whether some customers stay or go. That’s why at this point they aren’t worried about the “cord cutters” who figure to get their video entertainment from streaming online video. Cable providers deem the cutters as low-value customers they’ll never miss.
With the focus now on “average revenue per user,” providers cherish customers who load up on all the extras, like HDTV, premium channels, DVR set-top boxes, etc.
“The goal — to get customers signed up for as many value-added services as possible — is not just about driving up revenues, but about making those services sticky and increasing customer lock-in,” Gigaom.tv writes.
You want sticky? Give some service that sticks.
I don’t want to see any business step off a cliff. But cable television can’t keep its footing by offering a level of service that’s on the cutting edge of the 1970s.
A school kid is sitting somewhere right now deep in thought on how to bring extremely dependable video and Internet service into homes across America.
I’m willing to bet what’s left of Ted Turner’s considerable fortune on the kid.
Just maybe on the days of future big games, the choking that occurs will be on the field and not in the cable TV connection.
Ted Carter is the senior economic writer for the Mississippi Business Journal. He can be reached at firstname.lastname@example.org.
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