There's a fascinating in-depth look published today in the Wall Street Journal that predicts the deaths of certain cable networks in the near future. For the past few decades the number of new cable networks appearing has kept growing and growing in subscribers channel packages. Many of these networks just air re-runs of old shows, like MTV Classic or Cloo (old reruns of law & order all day). But a lot of these old reruns are available on streaming services, like Netflix. Not to mention, WSJ cites that on average, people pay for 200 channels, but typically only watch 15.
To thwart the cord-cutters, cable providers are pressured to keep cable prices lower and feel the best way to lessen the dangers of people frowning at their high cable bills are to cut networks that people are charged for but never watch.
The writers explain how cable networks make their money. Each cable network in a subscriber's TV network package gets a small cut of the cable bill. Example, you pay $97/month to Comcast for a cable package. If you get ESPN, then about ~$7 of the bill goes to ESPN. Then there are also networks like Fox Sports 2 that get $0.29 from your bill. You would think the more viewers a network gets would determine how big of a cut they get of your bill, but it's not always so. Each network negotiates how much money of each check it gets with the cable companies. There are some networks that charge a lot, but are barely watched. These networks, they predict will be the first to close up shop because WSJ believes as people will want cheaper cable bills they will look to only request cable networks in their package that are cheap, but watch often.
Networks they predict will be canceled: Fox Sports 2, MTV Classic, ESPNU, IFC TV, Discovery Family TV, Centric.
https://www.wsj.com/articles/small-cable-channels-you-pay-forbut-dont-watchare-dying-1490111102?tesla=y
This is really interesting. I'm curious to see how the market plays out and if the structure for the share of money that goes to each network begins to change. It seems that as technology continues to improve there could be a marketplace for channels based on demand. I think this would be an interesting theory for cable networks to consider to stay competitive with "chord cutters".
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