Cord-cutting

Definition

Cord-cutting refers to the trend of consumers abandoning traditional cable or satellite television subscriptions in favor of internet-based streaming services. This shift is primarily driven by the rise of digital technologies, which have transformed how viewers access and consume media content, making it more convenient and often more affordable.

5 Must Know Facts For Your Next Test

1. Cord-cutting has significantly affected traditional cable companies, leading to declines in subscriber numbers and revenue.
2. Younger audiences are more likely to engage in cord-cutting, as they prefer on-demand content over scheduled programming.
3. The growth of smart TVs and mobile devices has made accessing streaming services easier than ever, contributing to the cord-cutting trend.
4. Content creators are adapting by producing original programming for streaming platforms, which has changed the landscape of media production and distribution.
5. Major sports leagues are also exploring streaming deals as part of their broadcasting strategies, recognizing the shift in viewer habits due to cord-cutting.

Review Questions

• How has cord-cutting changed consumer behavior regarding media consumption?
  • Cord-cutting has led consumers to favor on-demand content rather than traditional scheduled programming. This shift reflects a desire for flexibility, with viewers choosing what to watch and when to watch it. As a result, many consumers are prioritizing streaming services that offer a wide variety of content without being tied to a cable subscription.
• Discuss how legacy media organizations are responding to the rise of cord-cutting and the challenges it poses.
  • Legacy media organizations are adapting to the rise of cord-cutting by developing their own streaming platforms and investing in original content. They are recognizing the need to compete with established streaming services by providing unique offerings that attract viewers. Additionally, these organizations are exploring partnerships and bundling options with digital platforms to retain their audience while transitioning away from traditional cable models.
• Evaluate the long-term economic implications of cord-cutting on both traditional media businesses and emerging media platforms.
  • Cord-cutting is likely to reshape the economic landscape of the media industry significantly. Traditional media businesses may face continued revenue declines as more viewers leave cable subscriptions, which could lead to layoffs or restructuring. Meanwhile, emerging media platforms may experience growth opportunities as they capture a larger share of audience attention. The competition will drive innovation in content delivery, resulting in potentially lower costs and enhanced consumer experiences across various platforms.

Related terms

Streaming Services: Platforms that allow users to watch video content over the internet without needing to download it, including services like Netflix, Hulu, and Disney+.

Over-the-Top (OTT): Content delivered over the internet directly to viewers without requiring a traditional cable subscription, often through streaming services.

Subscription Video on Demand (SVOD): A business model where consumers pay a subscription fee to access a library of video content available for streaming at any time.