Cord cutting is changing everything, and the head of CBS knows it
A new study by Nielsen shows big gains in the number of homes that don't subscribe to traditional pay TV services. The number of Internet-only homes more than doubled year-over-year in the fourth quarter, from 1.3 million to nearly 3 million. The number of homes using only an antenna for broadcast TV also increased by more than 1 million, to 12.3 million households.
By comparison, traditional pay TV subscriptions fell by roughly 2 million in the fourth quarter, with the total number of households now at 100.8 million. While subscriptions increased through telco providers such as Verizon and AT&T, they failed to offset satellite and cable providers' losses. (Yahoo Finance's Aaron Pressman has put it all together in a handy graph.)
Even if the big cable bundle isn't dying anytime soon, TV networks are starting to realize they can't ignore the shift to streaming video.
"The days of the 500-channel universe are over," CBS President and CEO Les Moonves said at an industry conference this week. "The days of the 150-channel universe in the home are not necessarily over but they're changing rapidly. People are slicing it and dicing it in different ways."
CBS has already launched a $6 per month standalone streaming service for its main broadcast channel, and is planning to offer a standalone version of Showtime as well. According to Variety, Moonves said the Showtime service will arrive "in the not too distant future."
Why this matters: CBS is hardly the first network to reduce its dependency on traditional pay TV subscriptions. HBO is about to launch its own standalone service, and NBC is reportedly planning a cheap service focused on comedy. Several other networks have also signed into Sling TV, a $20 per month service that offers a smaller, cheaper bundle than cable.
Still, it's rare to see a network executive openly admit that the bundle is crumbling while seeking out alternatives. The new data from Nielsen merely shows that Moonves is acknowledging reality.