Tuesday, August 24, 2010

Traditional TV Still Holds The Cards

As figures show a decline in US cable subscriptions for the first time in history - a loss of 711,000 subscribers - arguments are raging in the UK as to whether this is a trend or a blip.

There's no doubt that the shaky economy and competition from telcos has had some effect (telco and satellite subscriptions were up nearly half a million).

Some commentators believe that this is not significant, and the NYTimes think that there is less to the 'cable cutting' trend, but other commentators disagree.

The reality is that television is in rude health and the prices paid for content production and rights are only sustainable through 'traditional' distribution media. This isn't a new trend. If you look at the long tail enabled by the rise of Amazon for the book industry it did not result in smaller titles selling more (indeed, through 'most popular' lists and other similar devices the head of the long tail is growing ever larger).

The cost of producing TV has fallen precipitously, but this has seen a commensurate rise in the cost of building an audience.

Television remains a high stakes game and the traditional players are still holding all the cards. Challenging this will take a bit more than just shifting the TV model onto the internet.