Cord Cutting: Cable’s Challenge

The vast majority of the public is speaking out, and not much is being done. At least, not yet.

No, we’re not talking about health insurance reform; instead this outcry is about cable television.

Despite strong consumer opposition, it appears that bundled cable packages won’t be going away anytime soon. This will lead to one of two results: Consumers continuing to overspend on cable content, or more cord cutting. (Probably both!)

U.S. Cable penetration in local media markets continues to fall, as advertisers pay more of a premium for a waning medium.

Cable penetration in local media markets continues free-fall; advertisers paying steeper premium for “niche” medium.

The average cable bill is still about $80 per month. When you consider that two-thirds of the programming fees on that bill can be attributed to the least viewed channels, it doesn’t add up for consumers who are growing more content-savvy by the day. The smart ones are finding other options.

Whatever happens on the consumer end of things, one thing remains true: the premium that local advertisers are already spending for the waning cable audience is about to go up … again. Too bad that many still think they’re getting a good deal.

The alarming trend of defecting cable households is nothing new. Cord cutting has been eroding cable audiences for years now.

Advertisers are catching on. Don’t miss your chance to remind them.

Dave Eckstein, ESA & Company | Real. Local. Results: 2012Dave Eckstein is a Partner in the firm ESA & Company. He specializes in highly profitable market share growth for local businesses and gets a kick out of demonstrating a declining cost of customer acquisition. He plays baseball, but isn't that Dave Eckstein.

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  1. What is the graph showing exactly?

  2. Hi Don … the caption fell off! We have corrected the post. The graph shows the downward trending cable penetration in local media markets, emphasizing the efficiency and effectiveness issues cable advertisers are already feeling (and will continue to feel in 2014 and beyond). Thanks for the heads-up comment. Happy Holidays, – DE

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