Imagine watching TV without paying the cable company for the blinking set-top box, using a gadget of your choice that makes it easy to switch between cable channels, streaming programs and online shows.
The idea, simple in concept, is proving difficult in execution.
U.S. Federal Communications Commission Chairman Tom Wheeler is pushing a plan to force cable companies to give up their control over set-top boxes, “unlocking” the marketplace as he puts it.
But he’s drawn opposition from lawmakers in both parties, not to mention some of the most active corporate lobbyists in Washington. Comcast Corp. and the cable industry — which stands to lose $20 billion a year in box rentals — say it’s unnecessary and are fighting it. So are Hollywood studios, DirecTV owner AT&T Inc., and CBS Corp. Even a fellow commission Democrat said Wheeler’s plan set for a Sept. 29 vote is flawed.
People just aren’t watching — or paying for — TV the way they used to.
The number of people paying cable and satellite giants like Comcast, Time Warner Cable, and DirecTV for TV service fell during the first three months of the year, according to a new report from MoffettNathanson, a media and telecommunications research firm.
It’s the first time that the industry has lost subscribers during that time, which is traditionally a strong period for pay TV, according to the research note. Last year, pay TV companies added 271,000 subscribers in the first quarter, and in the same period in 2013, they added 208,000 subscribers, according to the firm.
While U.S. cable television customers are longing to finally be able to pay for just the channels they actually watch, others have begrudgingly accepted that bundled television is still the way to go for getting their money’s worth. Companies like DISH, Verizon, and Sony have only announced in the last year their own plans for stand-alone streaming services. With a few clicks, $8 for Netflix NFLX +0.75%, $15 for HBO, $20 for ESPN could easily add up to a higher total than what customers currently pay for only a few channels they actually watch in a bundle. What’s more, it doesn’t look like companies will use the same set-top box, if they use set-top boxes at all (Sony and Verizon are looking to offer services completely on the cloud).
The distant dream of a la carte television has never seemed closer to reality. On Thursday, just a day after HBO said it would launch a new online streaming service that doesn’t require a cable TV subscription, CBS announced the launch of CBS All Access, a service will let users watch unlimited CBS content, including some live television, on multiple devices for just $5.99 a month.
It’s still too early to proclaim the death of the traditional cable TV bundle. And yet, the two announcements signal a drastic shift in the way both cable companies and networks—so often adversaries of internet TV services like Netflix and Aereo—now view the changing television landscape. Tech savvy consumers and cord cutters have been urging these companies to unhinge themselves from the traditional cable package for years. But now that they are, the question is: are consumers really ready for it?