Big Cable Takes Aim at 'Cord Cutters'

It used to be that if you wanted your company noticed, you would hire advertising agencies to run ads in the newspaper and put commercials on cable. With the advent of the Internet, that is no longer the case. In fact, many big cable companies are losing more and more customers due to "cord cutting" as customers move on to cheaper, steaming alternatives such as Netflix. Advertising agencies are also targeting more online resources such as YouTube and social media.

Big cable companies have been faced with a profit-losing dilemma these past few years. Many millennials and members of generation Z are used to watching YouTube and streaming videos from their computer, so many of them are "cutting the cord,” or never even getting a cord to cut in the first place and choosing video streaming options instead. This has made advertising agencies often choose to spend money on online ads over cable because of the different audience. 

However, cable companies won't surrender the money they receive from advertising agencies without a fight. Comcast and Time Warner, the largest and second-largest broadband providers, are currently testing Internet packages with limited data across the country. This effort could pose a problem for those who enjoy video streaming services, but still use the Internet for other things. 

The limited-data package that Comcast has been testing allows for a mere 300GB to be used each month. The Huffington Post explains that if you were on the 300GB plan, and you only watch online TV, by the end of the month you would only have 70GB left for everything from social media and YouTube to movie and song downloads. Perhaps the worst part is that if you go over, Comcast will charge you $10 for every 50GB used. 

According to Comcast, the limited-data plans are meant to help reduce the load on the neighborhood hubs, but Yahoo explains that this is not the whole truth. Limiting data may have a negative effect on streaming services, making consumers more likely to use the other services provided by the big cable companies.

Once the streaming service competitors have a smaller audience, advertising agencies in Utah and around the globe will also be more likely to try to reach audiences through the cable stations. Regardless of whether or not it is about money or reducing the load on service providers, the true test will be if the rising generations are willing to pay for the new rates. If they aren’t, big cable will have lost and will need to try something new. 

Ryan Muir writes for Fusion 360, an SEO and content marketing agency. He writes for many other clients as well. Follow on Twitter.