The Internet is displacing cable for a growing number of individuals, families, and businesses. More people are opting to become zero TV homes, which means they get TV service, not in the traditional ways, but via the Internet.
According to a recent Nielsen study, the number of zero TV homes jumped to 5 million from 2 million in the past six years. As budgets tighten and people embrace a simpler lifestyle, cable is increasingly seen as waste. This trend is not likely to stop, because the Internet offers a plethora of ways to do without cable.
Anytime access
The most obvious way the Internet is displacing cable is by providing access to the TV shows viewers want to watch. Though cable TV has made choosing when to watch your favorite show more convenient through DVRs and on-demand service, there are still challenges with these methods, so your shows may not be available when you want them.
The Internet streams your favorite TV shows to your computer whenever it's convenient for you. More shows are available than can typically be found with on-demand services, so more watchers are turning to the Internet to see their must-watch shows. A variety of devices (from game systems to viewing-specific technology) allow you to connect your computer to your TV, so you are actually watching Internet-streamed shows and movies on your TV set.
Thanks to the different technology now available to us, we now have different viewing habits than we did in the past. Fewer people watch shows when they are scheduled on TV, because it is so much more convenient to access them when we want. This also means we rarely watch TV ads anymore.
We used to watch TV for our news and weather. Now, of course, it is quicker and easier to go online and find the information we want. Opening any browser will give you access to the news of the day -- locally, nationally, and internationally. The Internet has effectively displaced cable as the way to get your daily news and weather.
Disconnecting cable
Businesses are starting to see the wisdom in funneling their advertising dollars away from cable TV. Niche cable channels were once the ideal way to reach your target consumers. Now that more people are turning to nontraditional viewing methods (without the ads), it is harder than ever to measure the effectiveness of cable TV ads, and it's harder to reach those viewers.
Dave Johnson, the owner of Safe Choice Security, told me he decided cable advertising had stopped working for his firm.
Ten years ago, we knew that, if we ran ads with Comcast here, we would be hitting a huge targeted audience... It was a no brainer. Now ad costs have nearly doubled, while the audience is smaller and less engaged. It just doesn't return much anymore. We've switched to almost entirely online advertising now.
Wise businesses understand that Internet advertising is much more effective, targeted, timely, and cost-efficient than TV advertising overall. Snack food manufacturers, car retailers, and beer companies will likely continue to use TV ads effectively, but most businesses, especially small and midsized ones, will likely eschew TV ads of any kind in favor of Internet advertising, which is, after all, where their customers are.
The sole area where cable TV retains its importance is live sporting events. People watch them on TV at their scheduled time. The enormous draw of such events is why their ad rates are so high. For now, a better solution for watching live sporting events is not available, but as soon as the Internet provides one, cable TV will become even more a thing of the past.
TV shows, movies, news, weather, and so much more are always available, always ready for you with your high-speed Internet connection. It truly is well on its way to displacing cable in homes everywhere.
— Gerad Hoyt is the online marketing director for Vast Bridges, a company specializing in channel marketing, sales, and promotion. You can follow him on Twitter @geradhoyt.
I have Amazon Prime, which for $79 a year I get free two day shipping. Along with this service, I also get to stream movies and television shows hosted on Amazon. The selection isn't as great as Netflix, but I am not a big viewer of shows anyways. It's nice to have something every once and a while to watch and since it comes with Prime I use it. It's pretty much replaced any sort of television watching I do unless I am with friends.
@dcawrey: Yes its good to have something which gives you what you want plus most importantly un-interrupted facility of movies or sports or whatever. I think it's something most of us want right now. The days with advertisements are gone.
DVRs let consumers skip commercials, which makes TV ads less valuable.
On the other hand, people will stop to watch commercials if they are really compelling.
Also, services like Hulu make it harder for consumers to skip ads.
And event TV like Mad Men are shows that fans watch in realtime so they can participate in the discussion on Twitter. That's another opportunity for brands to grab consumers with compelling commercials.
My company is a sub-contractor for a major manufacturer's warranty repairs for in Queen's County NY. I was suprised to find how many users are abandoning cable for internet based TV service. My unofficial 'observation' poll finds that Smart TV owners that are young renters are more prone use internet only setups.
@Mitch: I've seen a few people drop Hulu because they were paying for it and objected to dealing with paying for commercials too.
Simply put, with the way the Internet changes things both in consumer options and in the way marketers can measure and obtain feedback, doing things the old way is going to get diminishing returns over time.
If Hasbro can get massive amounts of free advertising for a My Little Pony cartoon show, surely other brands can invest in a quality program for adults that works wonders for their offerings.
It doesn't seem to matter where video entertainment is coming from. The consumer is spending way more monthly than they did a decade ago. Can anyone remember "free" tv? We're now stuck with a cable/internet bill that grows higher and higher every year. Unless one choose to get their tv with the traditional antenna, entertainment is a many dollars a day deal. There will still be cable for those on a "budget" although it's really not a bargain by any stretch.
Hulu brings back the format of watching late night television...which used to be the only way to see classic or cult films. (I know from having to had to persuade parents to let me stay up and see Dr. Strangelove or other flicks on after 11:30pm at night).
So now there are places to get up and go to the refrigerator, bio-break and so on. The ads are a fair trade for me, if the show is good (like Hulu's presentation of Endgame...the series about a chess master turned detective).
That said, I do miss the simplicity of channel surfing. TV watching isn't always, ok, I sit down and start up a show. For example, when I use my friend's DirecTV, it's more of a real time activity. I scan hundreds of channels and find a bunch of things that I am interested in and watch them all simultaneously by flipping channels...10 minutes of this, a couple of that. Strangely, that's still really hard with browser-based media.
Good point Jabailo, but my problem is I channel surf because my show goes to a commercial or nothing is on to begin with. At the end of they day it is about choice. People don't want to pay for a lot of channels they don't watch. For instance I want sports, news, and a couple of shows and that is it. However, I wonder how long it will take for commercial ads to saturate the streaming market.
in some cases, showtime's series Dexter when viewed from hulu is edited for content putting it in a PG 13 class and not the full-blown R-rated shown over digital cable service. I do resent the onslaught of late-night commercials for things like Viagra incontinence diapers while trying to watch a horror movie after I spent nearly $100 a month to watch it on TV service.
It's an odd thing but it maybe the experience of others too. As I have gotten older I have had less and less interest in TV. The dull dull commercials, the talking down to the viewer, the shows that idealize things I care nothing for, the parade of vapid and lifeless figures who seem to have no reflective life experiences of their own to share....call me old fashioned but I prefer my laptop or a good read.
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I recently stumbled across a great infographic from Zing Broadband that got me thinking about a topic that I believe we should all begin to seriously consider: Should Internet access be treated as a public utility?
For those who were living under a rock during the past few weeks, online sales are skyrocketing this holiday season. Black Friday and Cyber Monday alone represent the No. 1 and No. 3 all-time highest days for online sales, totaling a combined $3.28 billion, according to Adobe's Digital Index. To put that into perspective, it's more than the annual profits of Coca-Cola, Xerox, Radioshack, CBS, Southwest Airlines, JC Penny, and Petsmart -- combined.
New York's Metropolitan Transit Authority is conducting a pilot test of digital kiosks to guide subway users to where they want to go more efficiently and at lower cost.
The whole Amazon.reader debate is a double-stupid. It's stupid to think that there's any e-book buyer who doesn't know Amazon's URL, and it was stupider to let ICANN launch the whole free-form TLD initiative to start with.
While NFC's original goal was to enhance mobile commerce applications, it is finding its way into a number of other uses, which is creating both opportunity as well as challenges for IT departments.
Enterprises would like to move to cloud computing but are hesitant because they are concerned about providers’ ability to secure company data. Here are some tips that help to ensure that if breaches occur, the business is not left holding the bag.
Edmunds separates customers into segments based on the info it collects on its site and from partners, and uses that to push out custom content, said Brian Baron, director of business analytics for Edmunds.com, at Predictive Analytics Innovation Summit.
The automotive website uses propensity modeling to target ads and customer registration forms, said Brian Baron, director of business analytics for Edmunds.com, at Predictive Analytics Innovation Summit.
Ushering in a new era of cognitive computing systems, IBM announced today the IBM Watson Engagement Advisor, a technology breakthrough that allows brands to crunch big data in record time to transform the way they engage clients in key functions such as customer service, marketing, and sales.
Expert Integrated Systems: Changing the Experience & Economics of IT In this e-book, we take an in-depth look at these expert integrated systems -- what they are, how they work, and how they have the potential to help CIOs achieve dramatic savings while restoring IT's role as business innovator. READ THIS eBOOK
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