Bumbling Back to the Bundle


Published on Linked In January 24, 2020


Limp coaxial cables dangling from basement ceilings…


Ghostly dust outlines of dearly-departed set top boxes…


Barren home office desks where bills once stacked up…


Such are the telltale signs of revolutionary cord cutters who traded the tyranny of cable television for the freedom of over the top TV services. Consumers railing against inflexible channel bundles, disruptive advertising and lackadaisical customer service now have a panoply of options for independence: just add money. Coaxial liberation promised to place unprecedented levels of programming control and fiscal prudence in the hands of the TV viewing proletariat. But has it worked? Let’s just say 2020 will be a year of reckoning.


Cable’s greatest crime against the corded consumer was “the bundle”: standardized packages that forced the subscriber to pay for hundreds channels even if they only watched a few. The cry for a la carte channel selection had superficial logic on its side. Why should someone pay for more than they use?


The appification of TV - breaking down networks and channels into individual paid services - answered the consumers’ bundling lament. Cord cutters embraced paying for what they wanted, rather than what the cable company deemed they needed. Dropping a $125 per month cable bill for a couple of $10 subscriptions seemed like a no-brainer. With the undeniable benefit of personal mobile phones, game stations, streaming devices and Smart TV’s replacing leased cable set-top-boxes, the long dreamt of freedom-of-choice turned TV into an Ayn Rand utopia of pay-as-you-go unshackling. Like most Randian fantasies, however, short term liberties easily fail in the face of long-term economic realities.


The music industry (which dug many of the same ditches TV blindly drove into) learned that broad access works*. Across the streaming audio marketplace, the price of buying one CD a month covers unlimited access to wide catalogs of songs. Want to hear The Beatles? Any of the major services will scratch the Merseyside itch. Want to watch Ron Howard’s enlightening documentary The Beatles: Eight Days a Week? That will require a Hulu subscription this month. Want to watch it next month? Better not wait…


Subscribing to the top10 streaming video platforms would cost $150-$200 per month (depending upon one’s tolerance for paying to avoid advertising). That figure is comparable to the much-maligned traditional cable and doesn’t include the cost of BYOB (bring your own bandwidth) or set top hardware. As a result, there’s a good chance that multi-network viewers are paying more for less video content than they used to.


What is the industry doing to ease the pain?


Here’s a hint: YouTube TV offers 70+ cable channels for $49.99 a month. A Disney+, Hulu and ESPN+ package is available for $12.99. Netflix is available as a premium in Verizon FIOS and Comcast Xfinity cable packages.


In other words: bundles.


We should expect much more bundling in 2020 as consumers awaken to the extra costs and burdens of piecemeal TV. Who knows, maybe someone will offer a single-bill, 500 channel bundle that includes bandwidth? What we would call such a radical idea?


“Cable TV” has a nice ring to it.   

                                                       

*The music industry economics work for the consumer. It remains to be seen if streaming can adequately fund musicians and songwriters.