A TD Cowen analyst told Reuters that broadcast and cable TV revenue could fall by 7% this year.
Despite the expansion of digital advertising, the traditional TV sector, which accounts for 80% of ad revenue for media organizations, is still declining, according to the report.
The estimate highlights the bigger trend of cord cutting eroding the cable sector and the traditional way we’ve watched TV for decades. The rapid movement of viewers to streaming services has caused massive upheaval for media corporations, forcing them to rethink decades-old economic structures. Cable TV companies are losing subscribers, and media businesses are grappling with audiences that are shifting their attention to alternatives such as YouTube, TikTok, and a slew of free, ad-supported streaming services.
READ MORE: Cord Cutting Is Squeezing Spectrum’s Cable TV Business, And Even Wall Street Is Taking Notice
The stats are already bloody. Spectrum and Comcast both released their 2023 fourth-quarter reports during the previous two weeks. Last year, the two cable companies combined lost more than three million TV customers.
In addition, Spectrum’s total fourth-quarter revenue increased by 0.3% to $13.7 billion. Comcast’s entire fourth-quarter revenue increased by 2.3%, from $31.2 million to $30.5 million year on year.
READ MORE: Small Cable TV Businesses Are Disappearing
Following the disclosures, Comcast was dethroned as the largest cable company in the United States—only because it lost more customers than Spectrum—and Spectrum’s stock investment ratings were reduced by Wells Fargo and JP Morgan analysts.
Cable providers that haven’t gone bankrupt have moved into streaming TV while still providing internet in an effort to stay in business.
Meanwhile, media companies are struggling. Walt Disney is set to disclose its earnings on Wednesday, and it is likely to continue losing money on its streaming endeavors. Warner Bros. Discovery and Paramount are anticipated to tell the same story.
Cable TV networks are also at risk of being shut down or dropped by cable and satellite companies as they seek cost-cutting measures, potentially putting more pressure on media companies.
It remains to be seen what 2024 holds for broadcast and cable TV, although traditional TV is unlikely to experience a significant rebound in popularity.
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