Cable TV: Is Cutting the Cord Good News for Producers?on June 4, 2013 at 6:23 pm
Cable TV viewers are increasingly “cutting the cord,” according to the latest research by A.C. Nielsen. Simply put that means that increasing numbers of television viewers are canceling their cable contracts and choosing to get their media elsewhere. A lot of it is still on the television set, but it’s just delivered by other distribution methods, everything from Netflix to AppleTV. The accompanying chart shows the breakdown. “Zero-TV” homes are defined as homes that are not plugged into cable. The most astounding part of the chart is that more than a quarter of those in the 25-34 year old range are “Zero-TV.”
That’s bad news for the cable companies. They make their money selling subscriptions, often bundling the channels you most want with those you don’t really care to see. But what does it mean for producers? When cable TV really came into its own a decade ago it was a great time for independent television producers like myself. We could sell individual hours to networks hungry for content. There were enormous opportunities beyond the traditional networks. That was great news until cable television starting acting like network television, buying series, usually reality shows. Then it was like winning the lottery. If a show was picked up, you were made. If not there were fewer and then no opportunities to sell individual hours. For a producer, the sensation was akin to backing up and running full speed at an unforgiving concrete wall.
The market is now changing once again. With the advent of mobile and streaming technologies we can watch all of our favorite shows, increasingly, without being connected to cable TV. That’s great news for viewers, but the outlook is less certain for content producers. Since there are a lot more distribution channels there’s room for a lot more content. That means potentially fewer eyeballs for every program. That’s bad news for producers dependent on either commercial advertising or subscriptions. The one thing that the networks and then the cablers did was to aggregate large numbers of viewers.
The good news for entrepreneurial producers is that are now more entrepreneurial opportunities than ever before. You can find advertisers yourself and even work with them to provide content. This is the emergence of content marketing. You can find niches and produce specialized, “must-see TV” in those narrower verticals. A major national brand may not want to reach knitters, but yarn companies certainly do and they’ll pay to reach their niche audience.
We are really at the beginning of a new era. It is, and I almost shudder to use an over hyped term, a period of disruption. A great deal of uncertainty and dislocation often accompany disruption (e.g. job losses), but there are also enormous opportunities. The challenge is to find them. For the cable television companies that are able to adapt, it’s the beginning of a different and possibly great new era. For those that don’t, it’s the beginning of the end. It’s much the same for content producers. For those who are able to improvise and try new things, it’s quite possibly the start of a boon. For those who are less adept and less able to maneuver it’s the start of a period of uncertainty.