Cable Companies, Hemorrhaging Subscribers, Blame Economy

baby eating dog food Cable Companies, Hemorrhaging Subscribers, Blame EconomyIf you just ignore a problem long enough, it will go away. Right?

That seems to be the strategy of the cable companies. Last week Comcast reported that it had lost 275,000 subscribers in the third quarter and this week Time Warner announced it had seen 155,000 customers terminate their service.

When faced with these quarterly losses in the past, the cable companies insisted that they have seen no evidence that customers are “cutting the cord,” a catch phrase for dropping cable in favor of streaming video over the web. Instead, they blamed the poor economy, the customer, anything to avoid the truth. From The New York Times:

“The customers they are losing tend to be in the bottom half of the economy — a lot of them appear to be struggling to make ends meet,” said Craig Moffett, an analyst at Sanford C. Bernstein & Company,

Mr. Moffett said the image of the cord-cutter had been that of a “cutting-edge technologist” who preferred to bypass cable to watch programming on computers and on an ever-proliferating array of devices. “The reality is it’s someone who’s 40 years old and poor and settling for a dog’s breakfast of Netflix and short-form video.”

Unfortunately, a recent study from Strategy Analytics failed to support Mr. Moffet’s conclusion. It found that:

  • •54% of likely cord cutters are under 40.
  • •97% have graduated high school and 69% have or are pursuing higher degrees.
  • •91% are employed, full time students, or retired
  • •57% make more than $50,000 a year

Who knows — Mr. Moffet may not be all wrong. Some of these well educated, well-off cord cutters may still enjoy the occasional bowl of dog food while streaming movies from Netflix.