Blog: cord cutting

Even before the St. Louis (now LA) Rams were setting records in the NFL during the 1999-2001 seasons, earning the nickname ‘The Greatest Show on Turf’, the Super Bowl was viewed as an unrivalled opportunity to advertise brands, products, and movie trailers to the masses that tune in (or increasingly stream) to watch the showpiece for the world’s most valuable league .

Cord cutting and “the attention economy” are the landscaping trends reshaping everything video in 2019, and sports television – despite its reliably existent fanbase – is no exception. New sports proposition streaming video on demand (SVOD) entrants face hefty competition on all sides, from regionally established SVOD services with more varied offerings to tech majors waiting in the wings to buy up the biggest rights before moving onto the scene.

This article is derived from MIDiA’s US Cord Cutting Full Year 2018 report. Cord cutting is now an established part of the US pay-TV landscape, illustrating the impact of streaming video on demand (SVOD) and changing consumer habits globally.

Cord cutting is now an established component of the US pay-TV landscape, reinforcing the role of the US as the canary in the mine for the global pay-TV business. Cord cutting accelerated in 2018, highlighting the secular nature of the phenomenon.

German broadcaster Sport1 is replacing its US sport focused channel for the very first German-speaking esports channel. Sport1 announced last week that the channel dubbed eSports1 will launch in Germany, Austria and Switzerland on January 24th 2019, replacing Sport1 US.

British broadcasters Sky and BT confirmed this week a long-term extension and expansion to an overall content cross-supply deal. Following the initial agreement signed in the UK last December , the partnership now includes Ireland, allowing Sky Ireland customers access to Sky Sports and BT Sport through a single Sky TV subscription.

Facebook, the latest tech major to get involved with sports streaming, last week agreed its first ever rights deal with the English Premier league (EPL). This deal signified another step towards the transition away from traditional broadcasters and to digital streaming services.

Traditional linear TV broadcasters are feeling the strain from the reduction in loyal customers, as sports consumption continues to transition from TV to online and mobile. SVOD’s streaming content land grab, which drew scripted drama fans from traditional pay-TV, is now moving into the sports arena.

Wall Street is not renowned for its ability to take the long-term view. A good example is the recent massive sell-off in Comcast stock, which saw $16 billion wiped off its market cap. It followed the announcement last week from Comcast’s residential products chief Matthew Strauss, that the company could lose as many as 150,000 pay-TV subscribers in Q3 2017.

Amid all the noise and angst surrounding cord-cutting among the TV industry over the last two years, it is easy to fall into the trap of thinking that pay-TV is facing an irreversible decline. The reality, however, is that traditional pay-TV operators are facing irreversible decline (albeit a relatively slow and steady one), whereas streaming pay-TV is experiencing significant growth (and it really is time to stop thinking of streaming as anything other than another form of pay-TV).

Streaming video subscriptions are now firmly established as a key component of the pay-TV landscape and look set to be an even bigger part of its future. With Netflix leading the way, SVOD is gaining ground fast.

Slowly but surely the traditional media industries are waking up to the importance of YouTubers but those taking note most quickly are the subscription video companies, Netflix in particular. As recently illustrated by its commissioning of ‘Haters Back Off’ from YouTuber Colleen Balling-Evans’ alter-ego Miranda Sings – who incidentally has 6 million subscribers on YouTube, nearly 10% of Netflix’s entire subscriber base.