Netflix and Hulu are convincing millions of cable subscribers to cut the cord and dive into video streaming.
That's the conclusion of a new report released this week by the Convergence Consulting Group, which finds that 2.65 million Americans canceled cable between 2008-2011 in favor of lower-cost internet subscription services or video platforms.
The Canadian research firm estimates that 112,000 U.S. and Canadian subscribers were added to the cable rolls in 2011. That represents a more than 50 percent drop from the 272,000 who signed up for the service in 2010.
On top of that news comes this from DHD
Moguls will need a stiff drink nearby when they read Morgan Stanley analyst Benjamin Swinburne’s bracing report today about the state of the home video business — and Hollywood studios. He says that film operations at Universal, Disney, Paramount, Fox, and Warner Bros are worth about $19.3B, down from $40.2B in 2007. And a big reason for the 52% drop is that studios’ annual home video profits from each TV household fell to $100 last year from $127 in 2007 — and will continue to slide to $93 in 2015.
It is going to get worse before it gets better.Meanwhile, DVD sales are falling much faster than Blu-ray disc sales are growing. And overseas opportunities aren’t sufficient to change the story given “lower studio settlement rates for international box office, a minor international home video market and rising film costs.”