If you haven't been paying attention, after years of healthy growth, traditional pay-TV has been struggling over the past few years. According to Bloomberg, analysts estimate the industry will lose between 280,000 and 360,000 subscribers in the recently completed third quarter. And although this is a reprieve of sorts from the 600,000 the industry lost in the second quarter, it is still 70% higher than losses in last-year's corresponding quarter at the midpoint.
The industry's problem is actually threefold: The first two issues related to total subscriber numbers are both "cord-cutters" and "cord-nevers." The first group consists of many who are abandoning the format as cable-cost increases continue to outpace overall inflation. The second term, which focuses on millennials, consists of people who never been subscribers.
However, sometimes lost in the larger conversation is "cord-slimmers." Unlike the aforementioned designations, cord slimmers still see value in keeping a pay-TV package, they just don't want a large, bloated cable bill transferring their hard-earned money to political pundits, highly paid athletes, or to the Kardashian family.
For all these users, streaming services, once dismissed by operators, are slowly becoming a part of their service mix. Joining DISH Network's Sling TV, Time Warner Cable (UNKNOWN:TWC.DL) and Charter Communications (NASDAQ:CHTR) have recently made moves embracing streaming service.
Time Warner Cable plans to stream in NYC
In New York City, Time Warner Cable is now offering a beta test with its TWC TV product. The Internet-only version starts at $10 per month and will carry an estimated 20 channels, according to tech site Engadget, in what appears to be a rebranded launch of the company's app.
For those wanting to more content, the service has additional options: For $20 per month, subscribers could add Showtime and Starz and for $50 per month users can get a Standard option, which includes the aforementioned premium channels among a large pay-TV package.
Interestingly enough, and unlike DISH Network's Sling TV, TWC actually requires additional hardware. For those taking part of Time Warner Cable's over-the-top test, the company will provide privately owned Roku's Roku 3 streaming-media player and will include live channels and on-demand viewing. However, it seems Time Warner Cable isn't the only major provider dipping their toes into the nascent streaming-TV market.
Charter quietly enters the market as well
Charter Communications is also moving forward in offering a skinny, Internet-only service called Spectrum TV Stream. According to DSL Reports, the Midwestern-based service is nearly $13 per month, has no long-term commitment, and streams local broadcast channels with a choice of HBO or Showtime. For roughly $20, users would receive heavily watched cable channels ESPN, FX, TBS, and AMC.
Perhaps unsurprisingly, Charter's service also requires a Roku 3 box, which it also supplies. If you've been following the operator landscape recently, Charter recently bid $56 billion to buy Time Warner Cable, and Time Warner Cable's shareholders approved that offer last month.
While the deal is still in the process of getting regulator approval -- something that didn't happen when Comcast recently attempted to buy Time Warner Cable -- both operators offering this service within days of one another, and using the same hardware strategy, seems to be more than mere coincidence.
In the end, however, it seems more cable companies are embracing low-cost Internet-only bundles to respond to lost subscribers. If the industry continues to lose subscribers, it's possible to see more competition for cord-slimmers, cord-cutters, and cord-nevers.