Cord Cutting: The Best Alternatives to Cable TV

While the idea of cord cutting has existed since about 2008, cable and satellite TV providers didn't have any reason to worry until 2014 when the ability to "cut the cord" became increasingly easier for consumers. The reason for cord cutting is of course to save money. Many people have thrown away their $75/month TV plans in search of a more cost friendly option and that's exactly what they got with the insurgence of media streaming devices such as Apple TV, Roku, Amazon Fire and Chromecast. These devices enable the user to experience video content like that delivered by cable providers but with a customizable plan that is often much less expensive. The devices hold several thousand apps or channels that are downloadable. Some channels offer free content while others, like Netflix and Hulu, require a monthly membership.

In 2013, only 7% of US households with broadband capabilities were using a media streaming device; a number that major TV providers didn't have to worry about. In 2016, it was estimated that 52% of US households now use a media streaming device. In just 2 years time, the number rose from a blip on the radar for major cable companies, to a giant thorn in their side. While these media streaming devices haven't created monetary losses for the major cable TV providers, they have handed pay TV a loss to tune of 385,000 subscribers last year alone. Luckily for companies like Comcast, TWC and Charter, the need for higher internet speeds increases as the cord to TV gets cut. This need has supplied these major companies an outlet where they can still show year over year profit improvement while their main product, television, has shifted to the background.

With the need for internet speeds up over 5 Mbps soaring, more subscribers are willing to pay an extra $15 per month for a 2nd tier internet connection because they do not have to pay for a TV subscription as well. With DSL and Satellite internet speeds often times running well below the 5 Mbps threshold, the use of these services has steadily decreased as well while consumers look for streaming capable connections. The uptick in streaming users is one of the big reasons that Exede has finally pulled the trigger on the ViaSat2 launch which has been in the works for 5+ years.

Even though all of this news may be negative for the major cable providers, it's welcomed news for companies like Roku who currently dominates the market with 37% of the business when it comes to media streaming devices. Next in line with 19% is Google's Chromecast which is more of a media transmitting device, but has most of the same functions as a Roku or Amazon Fire. After Chromecast, the Apple TV (17%) and the Amazon Fire (14%) round out the top four streamer's dominant presence in the market as they leave only 13% of the share to countless other devices.

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