Comcast stock dropped about 7% on news it would lose 100-150K subscribers. Part of the explanation was Hurricanes. The same day…Snap stock rose 8%.
Cord cutting + OTT/Netflix = Industry change
Media companies were also dragged down with Comcast’s one-day plummet. Because of: OTT, Sling, NetFlix, PlayStation Vue, Amazon Prime, and TV programming through Snap becoming a mainstream alternative, it’s hard to imagine a world where organic cable subscribers will ever buck a declining trend.
So will TV Be Free?
In 1990’s wireless telephone plans, it was all about the minutes. Today, voice minutes are free. Data is the new oil.
– Verizon is offering value-added perks for high paying Verizon customers (in exchange for use of customer data).
– T-Mobile is now offering free Netflix for certain wireless plans.
– TV/Video programming on Snapchat is now free
– Sony PlayStation Vue offers almost everything you get with cable (and ESPN) for $30 a month
The new norm: cable subscribers will continue to decrease, and local cable and broadcast will feel the brunt of pain with fewer subscribers and little to no research offered to local advertisers proving that their local TV advertising works or doesn’t.
In order to stop the trend, cable’s got to either give away TV free (with bundling of high speed Internet and more)…or make up the revenue shortfall with more expensive HH Addressable advertising.
Cord cutting isn’t just a phenomenon: it’s here to stay unless there’s a compelling reason to put down the proverbial scissors.
Snap stock’s soars 8% the same day that Comcast drops 7%.
The market has spoken.