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Cord Cutting Essay

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The traditional cable plan has been hit hard by the consumer-driven term “cord cutting”. The Internet has thrown curve balls to a number of industries and cable TV is currently up to bat. Cord cutting is the word used to describe a consumer ending their relationship with traditional cable packages and turning towards internet-based alternatives. The internet has taken down the barriers to entry in the TV space and brought new powerful players into the game giving consumers’ power over what content they pay for and consume. Streaming services have seen success as they are able to solve the many problems people cite with their cable companies such as price, flexibility and lack of personalization. Cable TV has largely worked on the model of content bundles …show more content…

Though consumers may choose to subscribe to a number of different sites, increasing costs, streaming gives the consumer more control over how much they pay and what they pay for. The lower prices also open the market to consumers who aren’t avid TV watchers. For the consumer who only wishes to watch TV on occasion, close to a hundred bucks a month is a hefty price tag with cable when Netflix is $10 in comparison. Back in 2011, when Netflix was just starting to become popular, CEO Reed Hastings was quoted as to why Netflix was successful. “The streaming service is priced so that people who use it once or twice a month will still find value and come back. And those who use it once or twice a week will rave about it to friends.” The low prices take the pressure off utilization and in turn have increased the market for subscriptions. The price structure takes premium TV out of the luxury product category and places it closer to that of an impulse purchase or an easy buy. Netflix has stated that their core principle is “personalization and user choice,” and with this principle they have given the consumer the

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