Live Sports at the Crux of the Demise of Cable TV

I did it myself a couple of months ago, and I often wonder what took me so long. Yes, I am talking about cutting the cord of cable TV. I have joined the masses switching to streaming networks like Roku, Hulu, YouTube, et al. And the biggest reason; live sports. When I was a Comcast cable user, I realized that of the hundreds and hundreds of channels they offered, I watched like three, and they were sports.

Fox has taken the lead among the mainstream broadcasters by focusing mainly on sports and news. This appears to be a formula that could be adopted by other alphabet legacy media companies. By the way, sports television advertising is big. Really big. To the tune of $70 billion dollars a year. It really is pleasing to see the cable industry take a punch in the gut after essentially abusing their customer base for years.

High prices, poor service, terrible customer support. One of the best tricks was every month you would get a new bill that was higher than the last month. Did taxes go up? Did they charge me for HBO that I never ordered?

This is capitalism boys and girls. I know there are those of you on the left who hate your cable, and in fact, according to Bloomberg, six people are cutting the cord every minute. For the sake of argument, I’ll say half are conservative and half are crazy.

The current new normal in the price point for streaming access, including sports, is $40 per month. This is less than my cable was. Depending upon who you go with, I like YouTube, they are still trying to figure out what the audience wants and how to bundle it. Let’s not forget that via the old fashioned TV antenna, all the major networks and about two dozen or so other stations are broadcast for free. It’s technical, but the quality over the airwaves is better than over cable. So basically, you buy an antenna for $25 and you have free TV. If it’s getting a little complicated, that’s because it is. If you are not a sports enthusiast, cut the cable and you are all set. Add Hulu for $5 and there you go.

So what’s the end game here? Well, as we mentioned at the beginning, its sports. In particular, football. The first real indicator will come in 2020 when rights to the National Football League’s Sunday night games come up for bidding. Rich Greenfield, a media analyst at BTIG Research, says, “Sports is holding up the entire ecosystem.

Pull out the sports block and the entire system collapses.” Other rights, for instance to Major League Baseball and National Hockey League games, will become available in 2021 and 2022, respectively. Ultimately, it will all come down to who controls the market for live TV, being news and sports and a smattering of others. After all, why do you need to watch an episode of Vikings in primetime? The narrative took place in the 8th century. Read a history book.

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