Why We're Cutting The Cable

Recession, Internet options pulling viewers away

By Scott Budman
|  Monday, Aug 30, 2010  |  Updated 4:24 PM PDT
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Sure, you may have watched the Emmys, and the Super Bowl live.  But admit it, you've been watching your weekly programs on Hulu, and streaming your movies from Netflix.  Turns out a lot of people are cutting back on traditional pay TV, and we now have the data to prove it.  According to research firm SNL Kagan, paid TV subscriptions fell for the first time ever in the second quarter of this year.

This is, it seems, partly an economic story.  Cable TV has gotten pricey, and in tough times, people cut back on things that seem like luxury items.  For some, it's the gym membership.  For others, it's the cable.  And, while you can get your exercise elsewhere, you can - thanks to technology - get your entertainment elsewhere, too.

Netflix, as we've mentioned before, is on fire these days, as people are willing to wait a little bit to get their favorite TV shows and movies sent either in little red envelopes, or sent streaming onto their computer or mobile device.  Thanks to iPad and iPhone apps, you don't even have to be on a laptop to catch your 'flix.  They'll come to you.  All for far less a month than that cable bill.

But Netflix has competition.  Amazon is streaming movies as well.  Hulu (partly owned by NBC) streams TV shows new and old.  CinemaNow and Slingbox are other options.  All get you your entertainment, all for way less than cable.  It's a lucrative niche, expected to be attacked even more aggressively later this week by Apple.  Rumors have the Cupertino company strengthening its Apple TV, while letting you pick and choose movies and TV shows through iTunes.

According to SNL Kagan, the average cable bill these days is $71 a month.  That'll get you a lot of entertainment, no doubt.  But consumers seem willing to hunt it down online, while saving money at the same time.

Scott's company, NBC, may soon be bought by Comcast, so he'd be an employee of the cable company. He's on Twitter:  @scottbudman

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