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TMT Perspectives Insight & Commentary on Business, Legal and Policy Developments Affecting the Telecom, Media, and Technology Sectors

Hot News: PwC Reports that Cable Customers Are Price and Value Sensitive

Posted in Technology

ThinkstockPhotos-467648706Not surprisingly, consumers believe that cable fees are excessive. Customers say that cable service is too expensive, complaining about both the service fees and the set-top box fees. Many customers are demanding “skinnier” content packages, aimed more at their particular interests. Others desire to cut the cord completely, while the next generation of consumers are unlikely ever to subscribe to cable content services, because they don’t see the need to have prepackaged content “streamed” to them 24 hours a day. They would rather find their own content and consume it via the technology of their choosing.

If anything, cable is continuing to reap substantial revenue due largely to habit.

    “I want to get rid of cable because we pay $100 and we don’t ever watch it.”
– Pay-TV subscriber, Male, age 35 to 49

Underneath it all is good news for consumers: Although it will be messy for cable companies to transition to the new world in which content is consumed in more nuanced ways, the end result is there will be increased competition for content, meaning that content will continue to diversify to meet the changing needs. In the long run that means both more content and content more narrowly tailored to diverse interests.

The other new development is that there will be, of necessity, new businesses or technologies to help consumers figure out how to consume content from diverse sources.

The most surprising thing to us in the report is that consumers don’t seem to be opposed to TV commercials, and that they appear to watch a lot of them even when watching a program that has been recorded. That befuddles us entirely.

If you are interested in reading more about this, please see the PwC report.