Here’s how cable channels make money: your cable company bundles them in packages, and makes you buy them in those bundled packages, so they get retransmission fees. They also sell advertising.
One problem: this model is increasingly under threat. Big Cable is starting to make noises about unbundling, or at least shrinking the size of the bundles you have to buy. TV advertising is worth less and less as the audience splinters and shrinks. So where does the Lithuanian Miner Channel go?
YouTube! At least that’s what the head of YouTube thinks.
The top network executives are really taking notice. They’re asking questions about who is doing well, about who is building a professional management team. And I think eyes are very much on this space now.
In other words, the same stuff we’ve been hearing for years. Nonetheless, though, he’s got a point: just recently, Nielsen noted that 4.5% of all households have Internet and broadcast antennas — but no cable TV. That’s a minority, roughly the same percentage that have an antenna, but no internet or cable. But unlike the rest, that sector of the market is growing; 22% in the last year.
And as we broke down a while back, it’s fairly easy to avoid cable and watch most of what you want to see. So, maybe sooner rather than later, cable will realize it’s the twenty-first century now, and get caught up accordingly.
(Image courtesy Mike Cogh on Flickr)