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The cable package of the future is officially here

The cable package of the future is officially here

A new kind of cable package has arrived, one that will unify two increasingly expensive bills—Charter’s Spectrum cable and Disney’s streaming services—into one. It’s the kind of move we all would have loved to make on cable 10 years ago, when we were all cable subscribers. This is exciting news, but for a rapidly shrinking audience.

This package is the surprising result of a long-running dispute between Character and Disney. Earlier this month, Disney-owned channels on Spectrum stopped working. Without ESPN. No Disney channel. No special effects. Thanks to the way cable works, you couldn’t even watch a free-to-air channel like ABC if you were using Spectrum.

The two companies were in intense negotiations and competition. Charter, the second-largest cable provider in the United States, with more than 32 million subscribers, was tired of the high price of Disney channels, particularly its expensive crown jewel, ESPN. But with its subscriptions dwindling and constant headlines about the death of cable television, Charter was on the defensive in negotiations. Disney, with ESPN, its more than 150 million Disney Plus subscribers, nearly 50 million Hulu subscribers, and more than 4 million Hulu subscribers with Live TV, were not.

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In the end, the two giants agreed on a package that would be beneficial for both parties. You’ll now get Disney Plus Basic (that’s the version with ads) when you pay for Spectrum’s TV Select package. Choose the Spectrum TV Select Plus package and you’ll also get ESPN Plus. The result should work more or less like Max currently does: If you subscribe to HBO through your cable provider, you get Max for free; Disney Plus will start to feel the same.

Only, in addition to the included subscriptions, Charter is taking a page from Amazon and Apple’s book, essentially allowing you to combine your bills. Do you have to get Spectrum cable because it’s the only Internet provider in town? Well, soon you’ll also be able to combine your Hulu with the Live TV service. Multiple services, one invoice. That’s a step up from the HBO situation where you’ll have to cancel HBO and then subscribe directly to Max if you want the more expensive 4K version of that service.

The new packaging is a good thing for consumers. According to a 2022 C+R Research survey, 42 percent of Americans are paying for a subscription they forgot about. So this new style of billing from Charter would mean one place to go and view subscriptions and select add-ons when needed. Less thinking. More purchases and cancellations on your own terms (hopefully).

“For Charter, this deal was… trying to save their industry.”

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Evidently, companies have been a bit reluctant to adopt this style of underwriting. Streaming services want your money and are perfectly fine with you forgetting how much you shell out. But cable is changing. Its power has diminished, and Netflix CEO Reed Hastings’ constant assertion that “cable is dying” feels much more accurate than before.

There are the obvious examples of the cable’s falling star. Earlier this year, Nielsen and Leichtman Research stated that more people watched non-traditional media like YouTube, TikTok, and streaming than traditional television. AMC, one of the most powerful and popular cable networks, has partnered with Warner Bros. Discovery to put some of its content on Max. Warner Bros. Discovery has joined Paramount in selling a portion of their respective stakes in The CW to Nexstar. Meanwhile, Disney is exploring selling ABC to Nexstar or Byron Allen and trying to decide whether to sell ESPN, split it into parts or strike a deal with another sports-loving company. The reason Disney agreed to this landmark deal with Charter in the first place is because it needs to keep charging lucrative cable fees until it decides what to do with ESPN. That’s why it happily allowed Charter to drop some of its smaller networks like Freeform (the channel formerly known as ABC Family).

“You couldn’t move to a new transformational model without ESPN.”

For Charter, this deal had less to do with adding value to Disney Plus and ESPN Plus and more to do with trying to save its industry. At an investor conference in New York two days after the announcement, Charter Chief Financial Officer Jessica Fischer was clearly optimistic about the deal, telling attendees it could “stabilize” the faltering pay-TV industry, particularly by keeping the rights to ESPN.

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“You couldn’t move to a new transformational model without ESPN,” Fischer said, according to Bloomberg. “We were willing to accept their kind of market rate increases, but it was really because we knew they had that key asset and we needed them to be the first to introduce us to this transformation model.”

And it could be a very transformative model. If other major streamers like Paramount, Peacock, and Starz were offered through the same bill you pay for your cable, it could net them more subscribers and give cable a little more time.

But it won’t help with the two biggest streaming services: Netflix and Amazon Prime Video. They don’t have linear streaming channels to stream on cable, and since a vast majority of America subscribes to avoid pop culture FOMO or because the service also offers super-fast shipping, neither company really needs the streaming companies. cable and its packages. .

Which is a shame because while the new cable package might not save the cable industry, it will make things a lot more convenient… as long as you remain one of those increasingly rare people: the ones who still subscribe to the cable. .



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