Does Canada’s Food TV need special protection when it made 53% gross profits on the backs of cable subscribers that pay for the network whether they watch it or not?

“If you cut your cable, then your Internet is going to go up,” predicts Gary Pelletier, president of the Canadian chapter of the Cable & Telecommunications Association for Marketing.

That is just one of several predictions many Canadian cable and phone companies are claiming will come from the “disastrous decision” to allow consumers the freedom to pick and pay for only the cable channels they want to watch. Amidst claims that over 10,000 jobs will be lost, chaos and bankruptcy will stalk minority and niche cable networks, consumers will pay much higher bills, and American programming will boycott Canada fearing a-la-carte could make its way into the United States, Canada is at least having an adult discussion about the future of television and where it fits in the country’s identity.

Big changes are coming as a result of the latest great soul-searching made by our good neighbors to the north, always concerned about the potential of the Canadian Experience being overrun, if not decimated by the United States’ entertainment hegemony. In a moment of clarity, regulators have just realized what the rest of English-speaking Canada already knew: protectionist content regulations don’t work on the Internet. Canadians routinely bypass geographical restrictions and Canadian content laws with virtual private networks that relocate them, online at least, to a home address in the U.S. so they can binge-watch the unrestricted American versions of Netflix, Hulu and other online video services.

Regulators have now adopted the attitude – “if you can’t beat ’em, join ’em,” encouraging Canadian entertainment producers to create fewer, but better shows that will not only attract Canadian audiences, but those abroad.

Only the exchange is supposed to be mutual. High quality Canadian television productions like Orphan Black, Schitt’s Creek, X Company, The Book of Negroes, This Life, 19-2, Vikings, Killjoys, Rookie Blue, and Murdoch Mysteries are all among Canadian critics’ top favorites. But relatively few Americans know these shows exist or assume they are co-productions owned by some American entertainment conglomerate. Only a brief glimpse of a Canadian flag during the warp speed end credits might clue viewers this isn’t the case.

Despite protectionist media policies that have endured since 1970, the Canadians are now boldly going where Americans have so far feared to tread. They are having the conversation about the future of television and online entertainment in all forms while American media barons remain in denial.

For average consumers, the biggest change will begin next spring when the era of Canadian a-la-carte cable television arrives, allowing consumers to take an ax to the expensive 120-300 channel television package once and for all. Starting March 1, all Canadian providers will be required to offer consumers a basic cable package priced at no more than $25 a month, containing Canadian and U.S. over the air stations and networks, educational, and public channels. If you want more, you can have it by buying channels or mini-packages of networks individually to create a personalized cable TV lineup of networks you actually care to watch.

Programmers across Canada, particularly those catering to sports fans, foreign audiences, religious viewers, and minorities are horrified by the idea. So are media critics that fear the change could help bring an end to Canada’s unique multilingual and multicultural identity.

Customers like James Rehor of Hamilton explains why.

“Why would I pay for it? Why do I get it? Why does it come on my TV?” asks the 60-year-old construction worker. He’s ready on day one to purge the large number of French and other non-English channels from his Cogeco Cable lineup. Rehor offers comfort to sports programmers, however. He’s a big fan of the Toronto Maple Leafs, so Leafs TV, Sportnet, and TSN will stay.

Non-sports fans are another matter. They can’t wait to ditch the sports networks that are always the most expensive channels in a Canadian cable package.

“Clearly the most expensive (channels) will always be sports,” Pelletier tells the Canadian Press. “At the end of the day, for sports watchers, their cable bill will probably stay the same or increase, maybe … In the case of someone who doesn’t watch any sports at all, their bill will probably decrease.”

[flv]http://www.phillipdampier.com/video/CRTC Supporting the creation of content made by Canadians for Canadians and global audiences 3-2015.mp4[/flv]

An Age of Abundance: Canadian telecom regulators are transforming media regulations in Canada, recognizing the way Canadians watch television has changed. Quality, not quantity, is now most important. CRTC chairman Jean-Pierre Blais discusses the new reality. (6:08)

Pelletier and his industry friends are on a mission to convince Canadians to leave well enough alone and not drop the current all-for-one price cable television package for a-la-carte — not realizing the potential consequences.

Some in the cable industry have tried other scare tactics to no avail.

One industry-backed study predicted pick-and-pay could cost the economy 10,000 jobs. Consumers could care less. Unifor, a union that represents many in the television sector, seemed to agree Canada’s cultural heritage will be at risk with lowest common denominator programming dominating from St. John’s to Vancouver, much of it shoveled from the United States. But Canadians still want their House of Cards and Homeland.

Howard Law, a media spokesman for Unifor, predicts less profitable Canadian channels will fold under a pick-and-pay pricing model.

“The introduction of pick and pay will, in itself, lead to a major loss of revenues to Canadian broadcasting system, which ultimately plays out in less Canadian content and less Canadian jobs and less Canadian broadcasting,” he said in an interview on CBC’s The Exchange with Amanda Lang.

Minority interest and religious channels are also worried about their future. Most of those networks are classified as “specialty channels” by the Canadian Radio-television and Telecommunications Commission (CRTC). Legacy networks that have been around since at least the 1990s have been sitting pretty, protected by their designation as a “Category A” specialty station. Unlike in the United States, Canadian cable networks are licensed to operate by the CRTC, and at least 60 of those Category A networks also enjoy “genre protection,” a CRTC policy that guarantees their channel carriage on Canadian cable, satellite, and telco TV systems and protection from other cable networks that want to run the same kind of programming.

[flv]http://www.phillipdampier.com/video/CBC How New CRTC Rules Will Change Canadian TV 3-2015.mp4[/flv]

For decades, protectionist Canadian content regulations made certain Canadian television reflected its audience. But online video and the Internet has allowed Canadians to bypass traditional cable television to watch they want, not what the government hopes they will. New CRTC rules reflect that reality as Canadian TV rethinks how to get the viewer’s attention. From CBC-TV’s The National (4:16)

CRTC policies have allowed Canadian specialty channels to flourish despite operating in a smaller marketplace with fewer viewers than their American counterparts. That means networks like FoodTV and HGTV in Canada have profit margins ranging from 53-58 percent. Fashion Television and BookTV made an improbable $2.7 million in pre-tax profit, not so much from viewers but from the licensing fees every Canadian cable customer pays for the four networks whether they watch them or not.

From its start, Canadian TV has always faced a looming shadow from the south. Protecting Canada’s identity has been a priority for decades.

“If you’re a specialty channel that’s lived within the protective cocoon of bundling for years, you’ve gotten used to having a full-time job with benefits,” independent technology analyst Carmi Levy told CBC News. “Contrast that with living outside the protective cocoon, you’re essentially a freelancer, you fight for every contract, you have no benefits, there are no guarantees that money will be coming tomorrow or next week.”

It probably won’t be coming from subscribers like Mr. Rehor, who won’t hesitate to drop channels if they go unwatched.

The CRTC is also doing some dropping of its own, starting with genre protection, which could lead many specialty networks to follow American cable networks that today depend on chasing ratings to justify their licensing fees. The unintended result in the United States has been questionable lineup changes like the appearance of Law & Order rerun marathons on WEtv, a network supposedly dedicated to women’s entertainment. Ovation, a fine arts independent cable network that is about a niche as a network can be, depended on weekend binges of PBS’ Antiques Roadshow reruns in 2012 just to attract enough viewers to show up in the ratings.

Lesser known networks like OutTV, Canada’s only network dedicated to lesbian, gay, bisexual, and transgender viewers, may face an uncertain future if it can’t charge a premium price to make up for expected subscriber losses from pick and pay. Other niche channels may have to merge with other networks or more likely relaunch with an online platform and deliver a reduced menu of content to audiences.

Large Canadian mainstream networks and programmers don’t expect too much change from pick and pay, as most Canadians will likely still demand a package with their programming included. But distributors – cable, satellite, and telco TV platforms, do expect some major changes. The average Canadian now pays around $50 a month for basic cable, a price that will be cut in half next spring.

Rogers Cable already knows what is coming. It ran a trial in 2011 in London, Ont., with 1,000 customers who were given the choice of picking and paying for the channels they wanted. It didn’t take long for the cable company to discover customers loved it and TV stations and cable programmers hated it.

“We found that customers like bundles, but want to build their own. They want a basic package and an extra package they create,” Rogers spokesman Kevin Spafford told the Toronto Sun. “We did get push back from TV stations. There was concern about offering this service. They did not want us to proceed with that model.”

After the trial ended, Rogers allowed the pilot project participants to keep their pick and pay packages, something they’ve held tightly for over four years.

Rogers’ pilot offered something like what the CRTC is demanding be available to all Canadians:

ROGERS PICK AND PLAY PILOT

• $20 a month for “skinny basic” TV package of Canadian stations. (The CRTC plan mandates no more than $25.)
• 15-channel package for $27 a month. Other packages of 20 and 25 stations also offered, for more money. (The CRTC wants networks to offer channels individually or in mini-bundles.)
• U.S. major networks offered for $3 a month. (Under the CRTC policy, these stations may appear under the basic or a-la-carte tiers.)

REGULAR ROGERS

• Basic: $40 a month, 190 channels
• Digital Plus: $63, 220 channels
• Sports packages: $77, 230 channels
• VIP TV: $77, 270 channels
• VIP Ultimate: $119, 320 channels

The upcoming changes are probably the biggest in Canadian cable television history, but they still may not be enough to attract cord-nevers — those who have never subscribed to cable TV. Most are under 30 and already watch all their favorite shows online. Some budget-minded Canadians who want to cut their cable bill may consider joining them by cutting the cord altogether or slimming down their cable packages, but Pelletier warns that cable operators will not leave their money on the table.

Supplementing a slimmer cable package with a streaming service or two could increase data charges, Pelletier warns. Plus, you may have to surrender any discounts you get from bundling cable with home phone, Internet and/or wireless service.

Usage capped Internet is also still an effective deterrent for cord-cutting and whether your television entertainment comes over the cable or online, providers will still make a run for your wallet. Some observers predict providers will dramatically increase the retail prices of a-la-carte networks to limit potential savings while also continuing to raise broadband prices.

A 2014 national PIAC poll found 90 per cent of 1,000 consumers polled were willing to pay an additional $1 a month per channel, while 54 per cent would be willing to go $3 a month, and 21 per cent would be willing to pay $5 a month for an extra channel of their choosing. Many don’t realize under the current system the wholesale rate for many channels is under 50 cents a month. Considering what Canadians are willing to pay, it is likely cable companies will price channels according to what the marketplace will tolerate, which could be around $3 for each channel a month.

Suspicion about any cable company offering a New Deal is something Americans and Canadians have in common. Mr. Rehor is already keeping a wary eye.

“I think it’s a good idea, I just don’t know how they’re going to really work it,” he says, fearing it could ultimately end up costing the same amount he pays now.

[flv]http://www.phillipdampier.com/video/CBC Pick and Pay TV 3-2015.flv[/flv]

CBC News offers this extended discussion about the implications of “pick and pay” cable television. (10:11)

Charter Communications and Time Warner Cable believe they can win the war against cord-cutting by offering broadband-only customers a less expensive video package with a free Roku 3.

Charter Communications has been quietly testing a subscription service called Spectrum TV Stream that’s aimed at broadband-only customers, starting at $12.99* per month and includes a free Roku 3 streaming player.  Customers can start with a package of around 15-20 local/over the air, home shopping, religion, and weather channels, along with the option of adding Showtime or HBO for an extra $12.99 a month. Several extra cable channels, including: ABC Family, ESPN, Food Network, Hallmark, HGTV, LMN, Nat GEO, AMC, Discovery, History, FX, History 2, TBS and TLC are also available as an option for an extra $7 a month.

Because it’s Charter, there are some gotchas, as indicated by our *asterisk. The most disappointing is Charter’s insistence on applying its usual $5-8/month Broadcast TV Surcharge fee (it varies by market) to the streaming service. Other taxes, fees and surcharges also apply, which means most will pay at least $20 a month for a service Charter is advertising for $12.99. The Charter-supplied Roku 3 ($99 value, which includes a remote and headphones) is required to use the service and comes pre-activated. Customers can also access the service through Charter’s phone/device app, but out of home viewing does not function for some networks for contractual reasons.

Because the service is so new, Charter’s sales representatives have offered inconsistent information about the service. One current Charter customer was charged a $29.99 service change fee to transition to Spectrum TV Stream while several others were told they could not drop existing cable TV service and sign up for streaming without first canceling and disconnecting all Charter services for at least 30 days. To be fair, some representatives offered to open a new account in the name of another household member to avoid the 30 day waiting period and another used the opportunity to offer the customer a retention discount to encourage him not to change his service.

Gotcha with that $30 change of service fee, which may turn out to be a billing mistake. Also notice the out-the-door price of Spectrum TV Stream is higher than advertised.

Based on these experiences, it seems likely Charter is using revenue protection measures to discourage current cable television customers from switching to a less-costly plan.

You need Charter’s Internet service to subscribe.

Charter’s flyer about the service has been sent to cord-cutters, cord-nevers, and broadband-only customers with satellite TV subscriptions. But since a copy landed in our hands, we’re sharing the details with everyone.

To ask if the service is available in your area or to subscribe, customers need to call a special toll-free number: 1-844-560-5730. You will need Charter broadband service to qualify for the streaming TV service. The Roku 3 device is shipped to arrive within one week, and requires a customer signature or waiver on file for FedEx delivery. Although Charter claims the offer of the free Roku 3 expires Nov. 15, 2015, it is likely to be extended. Customers signing up will be considered qualified cable TV subscribers, allowing authenticated access to on-demand content from cable programmer websites, including premium services like HBO Go (if you subscribe). Up to 15 devices can be registered for viewing, five in simultaneous use. There is a 30-day money back guarantee and customers can cancel and keep the Roku 3 with no further obligations to Charter.

Quality and performance was rated fair by beta testers already signed up. The service works over Charter’s broadband network, which may be another reason the company dropped usage caps several months ago. Regular viewing will run up your usage numbers, but not as much as high-definition streams from Netflix or Amazon.

Charter’s Spectrum TV Stream apparently uses MPEG-2 compression and video quality is reportedly not comparable to traditional satellite TV or cable. Some claim it performs about equal to Netflix’s lowest resolution stream setting. Others complain it can take 3-4 seconds to change channels and streaming quality can dynamically change based on Charter’s broadband performance. Cable customers will also likely miss functionality they get with a DVR to pause, rewind, and start-over television programs — features all absent from Charter’s streaming service.

But even those disappointed with the service are welcoming the consolation prize of an effectively free Roku 3, which Charter allows you to keep with cancellation just for trialing the service.

Time Warner Cable is reportedly planning to launch its own streaming television package today for its broadband-only customers, starting with those in New York City. Usually reliable sources tell Engadget Time Warner Cable will launch a beta test of a new version of its TWC TV service. As with Charter, Time Warner Cable will supply a free Roku 3 tied to the customer’s Time Warner Cable broadband account.

Time Warner will offer its “Starter TV” package as a broadband add-on for $10 a month. That package offers viewers (in NYC): WABC, WCBS, C-SPAN, C-SPAN 2, C-SPAN 3, WWOR, WPXN, WLNY, WMBC, UniMas, WRNN, RISE, WYNJ, Educational Access, EVINE Live, WNYW, Galavision, Government Access, HSN, Music Choice, WNBC, WNET/WLIW, Public Access, QVC, SHOP NBC, TBN, TBS, Telemundo, TWC News, Univision, WGN America, WPIX, and several international/special interest channels.

Showtime and Starz will also be available in an optional package priced at $20 a month. If you want all of Time Warner’s channels and those premiums, they are bundled together for an extra $50 a month. We are not certain if the $50 bundle covered Time Warner’s “Standard” or “Preferred” TV lineup as of press time.

In essence, the package will look a lot like what current Time Warner Cable customers can access over the company’s TWC TV app. The difference is this is the first time Time Warner will sell IPTV service to consumers who now avoid cable television. These streaming-only customers will also never have to lease a cable set top box.

As with Charter’s service, Time Warner Cable customers will have to give up DVR services like pause, fast-forwarding, rewind, and start-over. The service offers no recording capability either, and maintains the same contractual restrictions that limit the number of channels you can watch on devices outside of the home.

Customers can stream video on up to four registered devices, including the Xbox One/Xbox 360, Android, iOS, Fan TV, Kindle Fire and Samsung’s Smart TVs.

It’s our contention these IPTV services are the likely future of cable television. It’s inevitable cable operators will eventually use their fiber/coax networks to deliver one platform — broadband, on which it will sell Internet access, television, and phone service. This could mean the eventual end of the set top box, replaced with inexpensive devices like a Roku. DVR’s can be replaced with cloud-based DVR-like services to manage time shifting and similar conveniences. That would be welcomed by many cable subscribers who detest the current generation of power hungry devices and their monthly rental costs, especially as cable systems continue to move to all-digital service, necessitating a box on every connected television in the home.

The current TWC TV app offers both good and bad to users. The alphabetic channel lineup is a welcome change from trying to find a channel by its number. The app is also ready-made for out of the home viewing, at least when programmers allow Time Warner the ability to offer that option. But TWC TV has also suffered from regular buffering glitches, service or channel outages, video quality degradation at peak usage times, and in our experience runs up to a minute behind live television.

“Must-have” ESPN is not as must-have as the pay television business once believed as the costly basic cable network reported more subscriber losses as consumers cut the cord.

Despite a claim from ESPN owner Walt Disney that the sports network is watched in 83 percent of U.S. cable households, the number of cable customers buying a television package that includes ESPN is in decline. Subscriber disinterest and the growing unaffordability of cable television are the two primary reasons even the “untouchable” cable networks are starting to see the effect of cord cutting.

ESPN is the most expensive basic cable channel, costing every pay television customer at least $6.61 a month in 2015 according to SNL Kagan estimates. That price increases by about 8% a year, needed to keep up with ever-increasing sports rights fees networks pay to televise events. With subscribers covering the bill, ESPN has been able to outbid traditional network television and other cable networks to win the rights to more prestigious events. But since broadcast networks now collect money from cable subscribers as well, bidding wars have erupted that have made sports teams and league organizations very rich, thanks to cable customers that pay for ESPN and other networks whether they watch them or not.

ESPN sports programming costs

But those days may soon be over, as customers discover cheaper “skinny bundles” of cable television packages or sign up for online video services that avoid costly sports networks. That was not possible just a few years ago. ESPN’s contract mandates its network be available on the standard basic tier — no optional sports tiers allowed, if a cable system wishes to carry it. To collect even more from cable subscribers, ESPN also effectively forces cable systems to carry one or more of their ancillary networks, which include ESPN2, ESPN3, ESPN+, ESPN Latin America, ESPNews, ESPNU, ESPN Classic, ESPN Deportes, Longhorn Network, and the SEC Network. That puts even more money in ESPN’s pocket.

The network has been a safe bet for investors for years, at least until this week when the company lowered its expectations for cable operating income growth from 2013-2016. Instead of growth between 7-9 percent, ESPN is now predicting only 4-6 percent. Although some might see that as a modest adjustment, Wall Street didn’t think so and Disney shares tanked 8.4% Wednesday. That was nothing compared to what happened today.

“Media stocks are getting slaughtered,” Aaron Clark, a portfolio manager at GW&K Investment Management, which manages $25 billion in assets, told the Wall Street Journal. “It’s been the long-running fear that we would eventually see cord-cutting. Everyone thought it would be a slow-moving train wreck, but Disney’s comment woke people up.”

Viacom, Inc. dropped 12 percent after it reported declines in second-quarter profits and revenue, which investors blamed on cord-cutting. Disney fell another 2.5% today and 21st Century Fox lost 6% after lowering its expectations for full-year profit for fiscal 2016. Cord-cutting, again.

To say ESPN is important to Disney would be an understatement. At least 75% of Disney’s cable network revenue comes from ESPN and estimates suggest 25% of Disney’s entire operating income in 2015 comes from the sports cable network. As ESPN faces customer defections and pressure on revenue growth, their costs are still rising. Sports rights at ESPN rose by 13% in 2014 and 19% in 2015, according to MoffettNathanson. If ESPN continues to lose customers and is forced to become more conservative about future price increases, parent company Walt Disney will feel the heat.

Newly independent Cable One will reduce its emphasis on cable television and turn its time, attention, and capital towards improving broadband service for its 690,000 largely rural customers in 19 states.

Cable One was spun off from Graham Holdings on July 1 and is not likely to stay independent for long before it is acquired by another cable operator, most likely Patrick Drahi’s Altice, S.A. — which recently acquired Suddenlink. But in the meantime, Cable One is attempting to persuade investors it is remaking itself into a broadband company, de-emphasizing the traditional cable television package in favor of dedicating more bandwidth for faster broadband speeds.

“Our standard broadband offering for our residential customers since 2011 has been a download speed of 50Mbps, which is at the high-end of the range of standard residential offerings even today in our markets,” the company reported in a statement. “Our enhanced broadband offering for our residential customers is currently a download speed of 75Mbps, which we expect to raise to 100Mbps by the end of 2015.”

Cable One primarily serves small cities and towns in the central and northwestern United States.

In several markets, 100Mbps speed is already available and regular pricing has been simplified to $1 per megabit of service: 50Mbps for $50, 75Mbps for $75, or 100Mbps for $100 a month.

To protect its broadband business model, which carries prices traditionally higher than larger operators, Cable One will stay focused on largely uncompetitive markets where it faces token DSL broadband competition from companies like Frontier Communications, CenturyLink, and Windstream. More than 75 percent of its customers are located in Mississippi, Idaho, Oklahoma, Texas and Arizona, many served by these three telephone companies.

Cable One signaled it will hold the line on cable programming costs as well. In April 2014, the company dropped 15 Viacom networks, including MTV, VH1, Comedy Central, Nickelodeon and others over contract renewal prices it claimed were too high. The cable TV package has continued without the Viacom networks for more than a year, resulting in the loss of more than 20% of its cable TV customers. More than 100,000 homes have dropped Cable One video service for another provider, but ironically that actually helped Cable One increase its cash flow by more than 11%, because it no longer has to pay programming fees on behalf of the lost customers.

On the bright side, Cable One executives discovered many of its former TV customers have stayed with Cable One for Internet service because the competition either does not offer broadband or generally provides DSL at speeds under 10Mbps. Company officials have emphasized this point to investors, suggesting broadband is a true money-maker and television can safely take second chair without sabotaging profits.

“We certainly have some sympathy for the notion that a broadband-only cable operator might be more profitable,” wrote analyst Craig Moffett in an investor note this month. “But there are some critical holes in the Cable One story. Does the company truly believe that all costs are variable such that cutting video will bring endless margin expansion? Are Cable One’s new shareholders really better off for having played hardball with Viacom?”

Moffett does not believe so because he is convinced Cable One’s independence will be short-lived.

“We all know the consensus opinion is that someone will buy Cable One,” Moffett wrote. “But the above questions still matter. Any potential acquirer would still place value on a video business, or pay less for the fact that Cable One has less of one.”

But as long as rural telephone companies barely compete for broadband customers, Cable One’s broadband performance will deliver them a de facto broadband monopoly in their largely rural service areas. That gives the cable company, or its next owner, plenty of room for rate hikes.

Ranger

While fast-forwarding through the 5,000th time I’ve briefly endured the mangling of Blondie’s “Rapture,” in those 2015 Acura RDX ads, I concluded two things:

• I will never buy an Acura RDX, if only to deliver the message that grating ads first thing in the morning will not win you any sale from me;
• I have not watched a commercial (on purpose) since 2011.

Ironically, the young woman behind the wheel of the aforementioned Acura is none other than Chelsea Ranger, who became a YouTube sensation after her husband recorded his wife rapping in the car to Salt-n-Pepa’s “None of Your Business,” itself an irony. Ranger’s singing was viewed by 17 million people watching a recorded YouTube video instead of cable television. Like popcorn, nobody quits after just one. YouTube is a confirmed time wormhole, where hours can disappear in what seemed like just a few minutes. This phenomena can also be experienced with Netflix, Amazon, or a myriad of other multimedia websites where on-demand entertainment is always on. How can it be 2am already? Darn, it’s too late to watch Anthony Bourdain and 18 minutes of ads on CNN now.

Advertisers wondering how many viewers actually spend time watching their commercials are right to be worried. Some have tried to cover their bases by spreading ad budgets around to include online video advertising. But when the online ads become meddlesome (Hulu, anyone?), here comes ad blocking software. No more Geico ads on YouTube, but the experience is less fulfilling watching a blank screen for a few minutes on certain other services. You might actually have to talk to the person sitting next to you.

What cannot be found online can be recorded with a DVR, if only to build up enough buffered video to blow right past those ad breaks. Others collect entire seasons of favorite shows, reserved for binge viewing later. All of this after-the-fact viewing is conditioning you (like a gateway drug) for a future life without linear/live television. You started just to be rid of the advertising, but now you seriously toy with getting rid of cable TV if you can find enough to watch online.

There are exceptions, of course. News and sports junkies are often uncomfortable watching recordings of in-the-moment events. Others cannot imagine losing sports aired on ESPN or CNN for breaking news. But beyond these groups, the chains that hold us to the linear 500-channel pay television universe are rusting.

Phillip “Ad nauseum” Dampier

Getting off the cable television drug is easiest if you never started. That is why Millennials, often cable-nevers, are among the least likely to buy a cable television package. They don’t miss what they never watched, preferring the personalized viewing of their mobile device or tablet over the family television. For those that grew up with the cable box and have never been without it, there was always suspicion that the stories from brave souls who canceled service and never regretted it come from closeted book-reading Luddites.

But consider for a moment you may already be watching less cable television than you think. Spend a week and take note of how much time you spend with the cable box. Then compare it with how many hours you watch Roku, YouTube, Apple TV, Netflix, or any other non-linear television experience. If you can find more to watch on YouTube than on cable, ditching pay TV may not be as hard as you think.

The cable industry’s response to the challenge of online video has been to shoot itself in the foot. Despite the constant complaints that cable programming costs are rising out of control, there is always room for more networks customers did not ask to receive. Navigating cumbersome set-top box software means many customers won’t find those new channels anyway. But they will pay for them.

The higher the price of cable television, the less value many place on it.

Cable operator (and network) greed has effectively ruined the industry’s best chance to prove continued value in an increasingly on-demand viewing world. TV Everywhere was supposed to make the 500 channel universe accessible online and on-demand for authenticated paying customers.

Some networks want customers to watch on their websites, others deliver shows on-demand from a set-top box. Instead of envisioning a TV Everywhere model to compete with online video, most cable companies are turning it into the equivalent of a DVR viewing experience with the fast-forward button disabled.

Comcast and Time Warner Cable make enormous amounts of free video available to customers. At the beginning, programmers used an informal honor system. In return for a quick pre-show advertisement and limited commercial interruptions, viewers wouldn’t bother ad-skipping if it meant they could watch a one-hour show in less than 50 minutes. Start inserting five 30 second commercials in every ad break and viewers will start looking for the remote control.

The challenge: should cable companies side with their customers and deliver a compelling TV Everywhere experience or with their bean counters, cramming ads into every available spot. Many are choosing the money. When customers rebelled and began to fast forward through the ads, the cable company retaliated by disabling that option (sometimes, it must be admitted, at the behest of a cable or broadcast network).

But it has gotten worse. For absolutely no reason other than to torture customers, Comcast is notorious for running a very small number of ads aired over and over and over again. Nothing makes television less fun than the same car ad repeated 10-15 times in a single one-hour show. Less is more is not a concept known to the cable industry. As a result, they will now have fewer television customers.

There is nothing about this quest for cash that has not been repeated in other forms of entertainment. Corporate commercial radio with 10 minute ad breaks drove listeners to Sirius XM or MP3 players. Running three minutes of ads to a captive movie theater audience that just paid $10 for a seat will not bring a theater chain any fans. The traditional 30-second ad is increasingly dead in the online world and advertisers and the companies that show them should adopt to the new reality instead of trying to force compliance to the “old ways.”

The cable industry earned its bad reputation by not listening to customers. Now that those customers have a choice to watch something else, the $80 cable TV bill is increasingly expendable as viewers cut the cord and never look back.

Is your linear TV experience not what it used to be? How often are you watching non-news/sports shows live? When the commercials start, do you reflexively reach for the remote control? Are you spending time with cable’s TV Everywhere on demand services? Share your thoughts in the comment section.