According to Business Insider, 1.8 million households decided to turn off their cable TV subscriptions in the 3rd quarter of 2013.
Satellite TV providers also saw a drop in customers, but at only 366,000, the exodus was far less significant.
There are several reasons why so many people are choosing not to pay for TV. For one, the internet offers streaming movies and other videos free, or a nominal monthly fee. Why pay up to $100 a month or more for cable TV when you can get your video entertainment on the web for a fraction of the cost?
Is this the free market economy at work? Well, no -not unless cable providers follow the rule of supply and demand and lower their prices.
That is not likely to happen, especially in some markets where deregulation has led to consolidation and monopolies, or competition never happened in the first place, like in rural areas.
In some parts of Florida, for example, consumers only have one cable TV provider available. So they either pay whatever the only cable provider demands, or use a satellite company. If they want free TV, antenna users can hook up to a digital box and at least get their local channels.
The more cable providers raise prices for service, the less people have to spend on other things. At some point, the benefits just don’t bring enough value for the costs.
Economics doesn’t just drive business models, it’s part of the decisions consumers make every day. When it comes to cable TV, more consumers are cutting the cord on spending.