What Is Cable Cord Cutting?

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The premium cable and satellite network HBO differentiates itself from its broadcast and cable network competitors through its dedication to the cultivation of premium programming as well as its distinct business model. Time Warner’s network HBO is “the prime example of a network brand built via quality programming” as evidenced by its overwhelming accumulation of awards and accolades as well as dedicated audiences (Berman). This premium programming is a large part of how its subscription based business model is able to thrive in today’s entertainment landscape. To compete with traditional cable networks and remain ad free, HBO has 41.5 million subscribers which has generated 4,415 million dollars in total revenue; more than any other cable…show more content…
With the increased pervasiveness and accessibility of the internet in modern life, consumers have been abandoning traditional television and cable for online subscription streaming services. Media Convergence has played a key role in enabling cord cutting in that content that traditionally has been exclusive to the television set is now available via the internet on multiple platforms, such as cellular phones and computers, that were traditionally reserved for other media. Now that television programs are able to be exhibited portably on laptops and smart phones over the internet, consumers have been given the option to forgo traditional cable and almost exclusively consume content online anywhere with very minimal restrictions. Companies, such as Netflix and Hulu, emerged to take advantage of this opportunity and facilitated the cord cutting movement by charging subscribers a reasonable rate for access to an enormous quantity of television content. To save money and consolidate their media consumption, many consumers have abandoned their cable packages in favor of subscription based services that provide television content in a more accessible, and in some cases a more affordable,…show more content…
Cutting out a cable subscription can potentially save consumers 100 dollars a month, even after they subscribe to new online television services such as Netflix or HBO NOW (Bajaj). With these online subscription services comes a plethora of content and if a consumer were to exhaust the extensive amount of content provided by one subscription service, they can easily unsubscribe and switch to a new service with different content. However, while creating an appropriate response to the threat of cord cutting, HBO is still facing challenges potentially because of its online subscription service being limited to streaming only HBO programs while other subscription services such as Netflix provide a diverse range of content for consumers to choose from. HBO NOW has proven to have a somewhat underwhelming effect in that it only gained 800,000 domestic subscribers as of June 2016, in comparison to Netflix’s over 75 million subscribers internationally potentially because of its inability to directly compete with other subscription services that cord cutters find to fit their needs and interests better (Berman). So, while this new online media landscape provides both more fiscal freedom as well as freedom of content for consumers, it has the potential for setbacks cable networks such as HBO even if they
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