With a raft of threats to the cable TV industry — the rise of Netflix, the shift to internet streaming, the increasing popularity of iPads, and the tightening of many families' purse strings — cable executives are worried. Leaders from three of the largest cable operators in the U.S., along with representatives from Time Warner, News Corp., and Viacom, are debating how to keep cable service relevant. What do they propose to do? Here, three strategies:
1. Quit worrying about Netflix
With 22.8 million customers, Netflix recently dethroned Comcast as the largest video subscription service in the U.S. But some executives are "comfortable" with Netflix's role, says David B. Wilkerson at MarketWatch. It's essentially a library of content, while cable companies and studios are the ones that create the movies and shows, says Viacom CEO Philippe Dauman, as quoted by PCWorld. Netflix even helps generate extra revenue for cable companies and studios by airing their shows and movies. Cable companies, says Time Warner CEO Jeff Bewkes, just have to make sure they remain the top providers of on-demand content.
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2. Lower the cost of service
With the nation's "growing wealth divide," the cable industry can "no longer take for granted customers who shell out $70 to $100 a month for service", says Meg James at the Los Angeles Times. Netflix, after all, costs as little as $7.99 a month. Time Warner is already offering scaled-back, cheaper cable packages, called "TV Essentials," in some markets. "There clearly is a growing underclass of consumers that can't afford (cable service), and they want it," says Time Warner CEO Glenn Britt.
3. Make cable TV available on more devices
"We need to embrace all of the screens," says Britt, as quoted by CNET News. "There's no such thing as a TV anymore." This means the industry needs to provide "more programming on more devices," including computers, game consoles, iPads, and other tablets. One initiative in the works, according to Reuters, is TV Everywhere, a service that would make shows available to paying subscribers across a variety of platforms. The industry's certainly not sold on it yet — but it's in the works.
Sources: CNET, LA Times, MarketWatch, PCWorld, Reuters
