By Mark Sullivan, TechHive, Dec 4, 2013
| The cable cord-cutter has become a bit like the UFO. Lots of | people, many in the tech community, want to believe this | person is everywhere, while a whole lot of other people -- | many in and around the cable industry -- deny his existence | altogether. | | But one class of cord-cutter -- the kind who cancels cable TV | service but holds on to cable broadband service -- has finally | begun showing up in the financial reports of cable companies, | and in the speeches of their executives. | | Time Warner Cable's CFO Arthur Minson addressed the phenomenon | at an investor conference in Barcelona last week, saying that | his company is seeing an increased number of single-service | broadband customers, as well as an increased number of | customers who buy faster Internet service tiers. In other | words, more and more cable customers are paying for Internet | service, but eschewing Comcast's TV content and phone service. | This development suggests a growing segment of cable customers | want to download a lot of rich media--like video. | | Time Warner Cable, the second largest U.S. cable company, has | roughly 5.5 million "single-play" customers, Minson said. | About 3 million of those buy TV service alone, while about 2.5 | million buy broadband service only. He didn't say how quickly | either group was growing or shrinking. | | But the overall subscriber group numbers suggest that the | broadband-only group is growing while the TV-only group is | shrinking. In its most recent quarterly report, TWC reported | that it lost 6 percent of its video customers over the past | year, but grew its broadband customer base by 1.7 percent. | TWC says that it's counting on home broadband sales -- and | upselling existing broadband customers to higher service | tiers -- for its future growth.
Well, I'm one of those broadband-only customers who "cut the cord" on cable TV. But it's not because I want to "download a lot of rich media-like video" -- it's because I switched to satellite so I can access programming that the local cable company doesn't carry (e.g. MSNBC, C-Span, RFD-TV, Rural TV, SiriusXM). Although I occasionally watch YouTube videos, I have never downloaded any media.
As I drive around town and nearby rural areas, I see satellite antennas on a substantial proportion of the houses. I'd guess over50% homes have dishes.
I also note that a lot of these homes are connected to the cable TV network. Maybe these are old abandoned connections formerly used for TV. But I suspect that a lot of them are broadband customers.
The article continues:
| Still, while the stats in the SEC filings strongly suggest | that the numbers of broadband-only customers are growing | rapidly, they don't prove it. That's because a high number of | cable customers still buy some combination of TV, broadband, | and phone service from the cable company. So a good chunk of | the 86,000 new broadband accounts added by Charter, for | example, may have also bought voice or TV.
Maybe they don't prove it. But the fact remains that I see lots of houses with satellite dishes and cable drops. They sure look like broadband-only customers to me.
And I'm speaking as a former cable guy who did exactly the same thing myself: switched to satellite for video but kept my connection to the cable company for broadband.
Neal McLain***** Moderator's Note *****
ISTM that the real question is "How many cable subscribers have /phone/ service through cable providers?", because IMHO that's a better indicator of the cable operators' future.
If those who "cut the cord" on cable /TV/ offerings are choosing VoIP phone service instead of the cable operators' dial tone, or are retaining existing POTS dial tone, then cable companies will have to look forward to a future where all their money will come from 'ping and pipe' offerings.
Bill Horne Moderator