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Down goes cable!

9/19/2013 03:53:00 PM
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I have never paid for TV, and never will. That's why I'm pleased to see Will Oremus telling us that the number of cable subscribers is set to shrink this year for the first time ever. Oremus feels that college is the proximate cause here--according to him, colleges are now offering high speed internet, but no cable TV for the dorms. I'm not so sure, since dorms usually have both. But one thing is clear: a plethora of online streaming services--youtube, hulu, netflix, not to mention network websites--now compete directly for cable TV's core constituencies. Most shows are now available for free, completely legal online less than 24 hours after they air.

Of course, network shows were always available for free in real time, and still are--now in HD to boot! But I digress.

I have previously weighed in on the economics of cable TV pricing, noting that a per-channel pricing structure, instead of bundling, would save a lot of customers a lot of money. One thing I want to point out, though, is that this result is only true if we assume that the cable provider acts like a monopoly. It now appears that the cable monopoly is unraveling due to healthy competition from the internet (no thanks to satellite TV, which as far as I can tell did nobody any good ever). The era of over-priced television is over.