Pay TV providers have a new message for consumers: Your ex wants you back.
While the media industry watches the once massive number of subscribers to cable and satellite services diminish like a slow-melting iceberg as audiences move to streaming, the companies are aggressively developing ways to slow the trend and perhaps win some business back.
Spectrum and DirecTV have both recently held fancy press events in New York to tout their efforts to offer a more consumer-friendly experience and services that add value for the still substantial number of customers they serve. Giving consumers more choice and flexibility is their new mantra.
The latest evidence of this emerged last week when Spectrum introduced an app store, where customers can get subscriptions to the streaming platforms such as Disney+, Hulu, AMC+ and ESPN, and access them alongside the broadcast and cable channels that still carry the bulk of high-profile sports and live events.
The Stamford, Conn.-based company’s 31 million subscribers can now get ad-supported streaming apps as part of their TV packages, which would otherwise cost an additional $125 a month. Ad-free versions are also offered at a discounted price.
Over the last year, El Segundo-based DirecTV rolled out smaller packages of channels aimed at consumers who no longer want a big monthly bill for the panoply of networks that have accumulated in the pay TV bundle over the years. The satellite TV service now offers smaller “genre packages” of channels and streaming apps that cater to a particular interest available at a lower price — designed for news junkies, sports fans, kids and Spanish-language speakers. There is one for entertainment channels as well.
There are early indications consumers are responding. In the second quarter of this year, Spectrum reported a loss of 80,000 cable customers due to cord-cutting, a significant decline from the same period in 2024, when 408,000 homes ditched cable.
DirecTV does not disclose its subscriber numbers, but Vincent Torres, the company’s chief marketing officer, said the smaller and more bespoke channel packages are drawing younger consumers who have bypassed pay TV subscriptions up to now.
For Spectrum, the deal to get the Disney apps came out of an ugly carriage dispute in August 2023 that for 12 days left customers without programming, including the U.S. Open tennis tournament and the start of the college football season. The standoff followed comments by Walt Disney Co. Chief Executive Bob Iger that taking the company’s program services directly to the consumer and bypassing its traditional pay TV partners was inevitable.
Spectrum CEO Chris Winfrey suggested his company could get out of the video distribution business and stick to selling its far more profitable broadband internet services.
The dispute was a sharp example of the pressure on cable providers that have been asked to pay more to carry the channels from Disney and other media conglomerates as they feel the pressure of rising programming costs and sports rights fees. The costs are passed along to customers who are paying more for content that is available on streaming services. Spectrum insisted on a deal that made Disney’s streaming apps available to its customers at no additional cost.
The tensions subsided and, in June, Spectrum reopened and extended its contract with Disney before it was up — a rarity in the contentious arena of carriage negotiations that lead to channel blackouts.
DirecTV’s slimmer cable packages came after a similarly bruising dispute with Disney last September, with customers losing access to the channels for 13 days.
But there was a new spirit of unity on stage at Spectrum headquarters, where ESPN Chair Jimmy Pitaro, the architect of ESPN’s direct-to-consumer strategy, was among the guest speakers.
Although Pitaro has long hammered away at how ESPN needs to be accessible to sports fans wherever they are, he touted the value of the cable subscription and described the relationship with Spectrum as “the best it has ever been.”
Spectrum customers already get ESPN channels through their cable subscription, but adding the direct-to-consumer app allows them access to its features such as enhanced real-time stats during live games and a personalized “SportsCenter” that uses AI to create a custom highlight show for users.
Spectrum has enlisted the networks it carries to make promotional spots touting its new services. Speaking at the Spectrum event, Winfrey acknowledged it will take some time for consumers to get used to the idea of getting more from their cable provider at no additional cost.
“Our No. 1 issue is — and this may shock you — but customers don’t trust the cable company,” Winfrey said. “Maybe with good reason. For how many decades did the cable industry go out and say HBO is included for free? And it was for three months and then, $10 would show up on your bill. We’ve conditioned people to think it’s a free trial period.”
Torres notes that more consumers are experiencing what he calls “content rage” as the prices of individual streaming services such as Peacock and Disney+ continue to rise. As programming gets sliced and diced for the growing number of services, consumers are finding that more than one subscription is necessary, especially for fans of the NFL or NBA, which have spread their games over several services.
“You see a growing frustration that ‘I can never find what I want to find when I want to watch it,” Torres said. “The fragmentation of the content is creating customer dissatisfaction. They can’t always find what they’re looking for.”
Along with its slimmer channel packages, DirectTV recently introduced a new internet-connected device called Gemini that combines streaming apps with traditional TV channels.
Pay TV companies are also offering voice-controlled remotes to help consumers find what they want to watch, whether on streaming or a traditional channel.
Executives say more enhanced viewing experiences are coming to keep the pay TV customer connected.
Starting this season, Spectrum’s SportsNet channel will be offering its Los Angeles customers several Lakers games in an immersive video format that can be streamed through an Apple Vision Pro device. The technology will give users a courtside view of the game at Crypto.com Arena. All that’s missing is a seat next to Jack Nicholson, but as AI advances, who knows?
Stuff We Wrote
Film shoots
Number of the week
Disney’s sci-fi sequel “Tron: Ares” got off to a weak start, opening with just $33.5 million in North American theaters.
The results were well below 2010’s “Tron: Legacy,” which opened to $44 million. The production budget for “Tron: Ares” was reportedly $180 million.
Still, Disney does have two potential box office hits later this year with “Avatar: Fire and Ash” and animated sequel “Zootopia 2.”
Finally …
Stacy Perman’s deeply reported piece on fake collectible movie props is a must read. Bonus points for an appearance by notorious movie and TV executive Jim Aubrey, known as “The Smiling Cobra.”
‘ The preceding article may include information circulated by third parties ’
‘ Some details of this article were extracted from the following source www.latimes.com ’
