Over the Top Video a Threat Today?

Gary Kim has interesting thoughts about whether consumers are cutting the TV cord or the current subscriber losses we are seeing are due in-part to the economy and consumers deciding to forgo payments on cable.

Here is an excerpt:

Still, that could lead to years of trouble, and could lead to a definitive shift to online video if the content providers decide to shift more support to online delivery. 

Some 13 percent of current multichannel video subscribers in the United States say they are “somewhat” or “very” likely to cancel their current subscription in the next 12 months, and not sign up with a competing provider, according to a survey of 2,000 U.S. households recently conducted by Strategy Analytics (NewsAlert).

So far, though, what we have seen seems largely to be a case of market share shifts between contestants, rather than a wholesale move to cord cutting. The other complication is that given moribund new housing starts, some amount of household consolidation and a sour economy, many consumers might be making temporary decisions to suspend purchases, without necessarily indicating a permanent shift in behavior.

The end of the article discusses how Kim isn’t sure if this is a permanent shift or just temporary. The reality is however that there is a war for people’s time and watching OTT video and streaming is becoming a larger portion of people’s day. And as the trend continues, the value of subscription TV diminishes. This isn’t something new I am sure as this is what is happening to printed magazines – but the question remains – how will cable and other TV providers deal with the trend in a way which keeps them relevant in the new world of TV 2.0?

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