Companies like Netflix are driving TV disruption

TV disruption is in full swing.

1024 683 David DeWolf

We’ve seen disruption wreak havoc on the newspaper industry. The music business has been turned on its head. For years we have been predicting that the TV business will go through similar disruption.

Of course, TV consumption has been changing for years, but by and large, satellite and cable providers have been able to hold serve. Despite a strong push from Netflix and other TechMedia disruptors, live news and sports have helped traditional stalwarts retain customers. Exclusive right contracts with sport leagues and streaming services that are intimately tied to traditional cable subscriptions have propped up an otherwise dying industry. That’s changing right now.

My own TV disruption story

For years I’ve been wanting to “cut the cable.” But, despite my desire, I could never find a strong enough alternative for live sports to make it actually happen. Frankly, live sports is the only TV I watch, so alternatives without that were dead on arrival.

10 months ago, in my quest to lower our cable bill, I downgraded to the most basic cable package. I had realized that our kids were no longer watching traditional TV and we simply didn’t use the plethora of channels we had access to. For 10 months we lived without the downgrade being noticed. Not a single member of the family realized I had changed our subscription – ESPN and the most basic of channels were all we needed.

Then the NBA Playoffs started. I went to turn on Game 1 of the Celtics-Pacers series and realized that we didn’t have TNT – the only channel it was being broadcast on. All of a sudden, the entire reason I had kept TV was no longer relevant, and as I searched for alternatives, I found that Sling and others actually had better packages for Sports Fans. I could get ESPN, TNT and a series of specialty channels for a fraction of the price of cable and not have to pay for the channels I didn’t want.

What the data says about TV disruption

Then I started asking around. It turns out that not only were young generations and technology gurus cutting the cord, a significantly greater percentage of folks I asked had experience and advice about cutting the cord. It seemed to be a more popular concept than I expected.

And, the data backs this up. In 2018, according to Variety, 33 million adults cut the cord. This is up from 25 million cord cutters in 2017. eMarketer is predicting a 10% – 15% increase in cord cutters over each of the next 3 years. If 40, 45, 50 and 55 million adults cut their cable in 2019, 2020, 2021 and 2022 as predicted, traditional TV providers are dead.

As if this change is not enough, these predictions come at a time of even greater uncertainty. The NFL’s TV deals with CBS, NBC, Fox and ESPN expire in 2022. The NBA’s deal with ESPN and TNT will expire in 2023. MLB’s deal with FoxSports ends in 2028. This has the potential to shake things up drastically. Will Sling make a move? Will Google get into the game and leverage the YouTube brand? If you ask me, 2022 is the year that traditional TV will officially be dead. Sling, Amazon, Netflix, YouTube, and even smaller brands like Pluto.TV are positioned to pounce. They are taking market share. We’re just a few years from cable being as dead as the newspaper business.