Usually, TV changes slowly. Distribution contracts are long. Rapid change is rare.
But in 2015 something unusual happened, and 2016 will be a much better year for TV viewers as a result.
Until 2015, it appeared the television industry was taking its usual, glacial approach to streaming video. Despite ample evidence of consumers cutting cable service or, in the case of younger adults, not bothering to subscribe to cable in the first place, networks and distributors dismissed so-called cord cutting as insignificant.
And for a long time it appeared that they were right. Consumers who cancelled or never subscribed to cable had few options outside of Netflix, Hulu and Amazon. And while those services offered increasingly compelling programming, the traditional networks and professional sports leagues that dominate the live broadcast business were only available through cable or satellite providers. Contracts were just too rigid to allow a network or league to stray from the status quo and offer streaming directly to viewers.
And there were the economics. It was in nobody's interest to make cord-cutting easier, or to help young consumers avoid installing and paying for cable in the first place.
So cable executives routinely downplayed the effects of cord-cutting and everyone took comfort as analysts dismissed cord-cutting as nothing to worry about.
But in October of 2014, all that began to change. HBO announced HBO Now, its direct-to-consumer app that bypasses cable. Days later CBS launched CBS All Access, for the first time reaching viewers directly without going through stations or cable companies.
And after that, the floodgates opened. Showtime, the NBA, NHL, PGA Tour, Viacom, NBC and even the NFL -- all announced or launched over-the-top, streaming video products in 2015.
Distributors started to hedge their bets too. Dish Network introduced Sling TV, a low-cost collection of popular channels marketed with "No long-term contracts. No set-up fees. No Catch." Comcast introduced their low-cost bundle called Stream, and Charter is quietly experimenting with a similar service.
This is all remarkable in an industry that is famously slow to change. But it happened just in time, because in August of 2015 the TV business changed.
Stocks plunged. Media companies lost billions in valuation. ESPN announced layoffs, then admitted they had also lost 7 million subscribers in just two years.
Wall Street had realized what most media executives were loath to admit: the fundamental economics of the pay TV business and all that it supports were at risk. Gone were the days of purely ad-supported programming, cable subscription revenue had become the real driver of the TV economy and if people stopped paying for TV it would have a massive impact on the entire business.
But many networks and distributors were -- despite their rhetoric -- already preparing for a streaming future by launching services like HBO Now, CBS All Access and Sling TV.
If the trend toward streaming continues or accelerates, the TV business is in for a rough ride. But because CBS, Viacom, Time Warner and Dish moved quickly, each is well positioned to profit if cord-cutting continues and are none the worse if it doesn't. There is still controversy, and there are plenty of issues to resolve, but the companies that spent 2015 planning for a streaming future were smart to do so.
So what happened? Why did Comcast, Charter, Dish, CBS, Viacom and major sports leagues all decide to get into the streaming business in 2015? Did these companies see signs that consumer expectations were changing? Did they fear the reaction they ultimately got from Wall Street? And will others follow, including local stations?
There may not be any one reason for the sudden change in the TV industry. But the bottom line for consumers is that as 2016 dawns, there are more options for watching great TV than ever before.
Whether they're cutting the cord, avoiding the cord or supplementing cable, viewers in 2016 can explore a variety of streaming services and will experience greater choice, convenience and control than we've ever had before.
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