Are streaming services a “zap” for cable TV?

by Benjamin Slomowitz

Since its heyday, millions of people have turned to cable television to watch local or national news, new episodes or reruns of their favorite shows, and enjoy movies without having to buy or rent them.  Viewers can scan the TV channel list, see what will be on throughout the day, and record shows to watch later when they have time to watch them. 

But that all changed when the mother of West Chester University student Sarah Renz, 20, decided she didn’t want to pay $50 for cable TV anymore, specifically Verizon. Her family had only used it for sports and nothing else.

“My mom would watch shows on Netflix and Amazon Prime, and I watched Netflix and YouTube,” Renz said. “My dad was the only one in the house to use cable, and that was only on occasion to watch live sports. So we were paying all this money for a service that we only used for one feature.”

Renz’s family is not alone in their decision to stop paying for cable in favor of streaming services subscriptions only.

As more consumers drop pay-TV from cable and phone companies in favor of streaming services, the telecom industry is protecting profits by jacking up the cost of high-speed internet. (Genaro Molina/Los Angeles Times/TNS)

According to data collected by the U.S. Congress in September 2020, streaming services’ popularity steadily rose between 2014 and 2019 with digital media players’ purchases, most especially Smart TVs, from 75 million users to about 155 million.

Adding insult to injury, the Pew Research Center,  a “nonpartisan fact tank that informs the public about the issues, attitudes, and trends shaping the world,” found that “cable cord-cutting,” begun in 2015, has only become much more problematic in recent years.  

Pew discovered that an average of 76 percent of U.S. adults in 2015 dropped to only 56 percent in 2021 with cable TV. The young adult age range (ages 18-29) had the most dramatic drop of all time, going from 65 percent to 34 percent within those six years.

Cable cord-cutting has gone to new heights within the past two years since brand-new streaming services, such as Disney+, HBO Max, Discovery+, and, more recently, Paramount+, became available primarily, in part, due to the quantity of content offered to consumers.

Disney+ offers more than 500 movies and 7,000 episodes of TV shows.

HBO Max offers “10,000 hours of premium content bundling all of HBO together with even more movies, shows, and Max Originals for the whole family,” according to their website. 

Deadline, an entertainment news website reports that Paramount+, reports “a content catalog of more than 30,000 episodes, 2,500 movie titles and 1,000-plus live sporting events and news coverage.”

Discovery+ presents “55,000+ real-life TV episodes, and 200 originals,” as indicated on their website.  

Live TV services, including FuboTV, Sling, and YouTubeTV, are also challenging traditional cable television.

And it’s not just over-the-top services and streaming TV apps that are ganging up on cable, but also streaming devices such as Apple TV, Android TV, Amazon Fire Stick, Roku, and gaming devices Xbox and PlayStation. 

So what makes streaming services, devices, and live TV apps stand out from cable or satellite? Why are more people looking to cut the cord now?

Price is one reason.

The average cable consumption in the U.S. has dropped by 20% within the past six years, with young adults between ages 18-29 contributing more to the factor. Photo courtesy of Pew Research Center.

Like cable/satellite, live TV and streaming apps charge consumers for using them; however, when they pay for monthly subscriptions for either service mentioned earlier, there are no hidden fees that consumers pay for, compared to traditional cable TV.

According to its website, Consumer Reports, a nonprofit organization that “works side by side with consumers for truth, transparency, and fairness in the marketplace,” in 2019, the cable industry charged consumers a hidden fee of $37 on 24% of monthly bills, which totaled $450 a year.

In contrast, some streaming services and devices offer free programming.

Local and national news (especially 24-hour news) apps have become available for consumers, especially during the COVID-19 pandemic. In Delaware County, popular local news channels also offer streaming, including 6 ABC, NBC 10, CBS 3, and Fox 29. 

Many TV shows and movies are also available to watch for free on ad-supported services, minus the “watch-anywhere” channel apps. Tubi, Crackle, IMDB TV, Peacock, Popcornflix, and Vudu only ask users to create an account before binge-watching anything.

Another reason for the popularity of streaming services is people’s desire to escape. Arjan Chatterjee, a neurology professor at Penn Medicine, explains that people worldwide who become immersed in something fictional on TV or in movies, are always itching to find out what happens next. Therefore, easy access or affordable streaming services give them the opportunity to leave reality in favor of the fictional world.

Streaming services have their disadvantages, however. For instance, not all primetime events are available to watch live if using only streaming services. 

Just recently, CBS broadcasted the 63rd Annual Grammy Awards ceremony, whose commercials proudly advertised the ability to live-stream the ceremony via Paramount+, something ViacomCBS had recently released. All of CBS’s programs, including local ones, are also available to watch on Paramount+. 

Flash forward to Apr. 25, when ABC will be hosting the 93rd Academy Awards ceremony. Not a single streaming service, especially Disney+, has allowed users to watch it live.

Instead, users have to subscribe to a live TV app like YoutubeTV or Sling if they want to watch the event as it unfolds in real-time. Otherwise, they would have to wait until the next day to view it. 

Another problem streaming devices and services face is internet connections.

Because all services and devices run on Wi-Fi (minus those with data usage), users need to be in an area where they have the best internet connection possible.

That said, streaming services are on the rise, making it difficult for cable companies to compete. One significant company advertises a free trial of two streaming services to combat the issue.

Christopher Serico, Verizon’s Employee Communication & Consumer PR Manager, stated that the one-year free trials of Disney+ and Discovery+ “offer eligible customers [those with unlimited plans] incredible libraries of dynamic content to stream on our reliable, fast and award-winning network, on us, for a year.”

For consumers planning to be the next person to cut the cord on cable, Roku explains what they should do:  

  • Prepare what you need and get organized. 
    • Pick when and where you want to host an appointment. You don’t want to feel rushed out of the door. Plus, you may have to talk to more than one agent before you can seal the deal.
    • Get internet/phone only rates if they offer such services, and if there’s a better internet service, tell your current provider about it.
  • During your call:
    • Don’t hold back. If your cable provider convinces you to stay by providing you with deals, don’t be afraid to reject them kindly. 

Experts also advise that because many streaming services limit how many people can use the same account simultaneously, consumers should be aware of this before sharing their accounts with any close friends or relatives.

Today, Renz feels like streaming services is the brand new cable TV, just without the hassle. She has said that her family has “saved somewhere between $10 and $15 a month once we switched.” 

Renz’s favorite streaming services are Netflix and Disney+. Her father loves Hulu, and the mother is into Amazon Prime Video.

She and her family have no regrets about making the change to streaming.

“There’s been such a huge increase in streaming services that now it costs about the same as cable,” Renz said. “So that’s why I feel like it doesn’t affect me.”

Contact Benjamin Slomowitz at communitarian@mail.dccc.edu

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