Many of you probably missed this, but the local cable company here in Anniston, Cable One, has been spun off. Cable One was spun off from Graham Holdings Company on July 1, 2015. And it’s now a stand-alone independent company. While Cable One is on its own for now, they are doing something very different than most other cable companies. For right now, they are pretty much ignoring cable TV service, and putting most of their resources on their internet products. Cable One has had a couple of disagreements with TV networks, the most famous one was with Viacom, which Cable One dropped all of their networks in April 2014 and replaced them with other lesser known channels.
Because of this, Cable One lost about 20% of its video subscriber base in the past 14 months, while cash flow has somehow risen more than 11% in the same period. The reason, because of lower content costs. It costs a lot less to carry The Blaze than carry Nickelodeon. In fact, Cable One predicts that programming costs will continue to fall 64% between 2015 and 2019. Does this mean Cable One has plans to discontinue even more popular channels, we will see? For now, Cable One is well known for its notable strategy of downsizing video operations in favor of building up broadband.
And now there are several articles saying that Cable One is ripe for the picking, and several people predicts that a larger cable company will soon buy up Cable One. Will this happen, I mean the company lost 103,232 video customers in the first year after dumping Viacom, ending the first quarter with 421,331 video customers. And the number of cable TV subscribers continues to go down. And you can see why this is happening, Cable One has been on some weird money saving mission to axe the most popular channels and replace them with lesser known channels with lame lineups, and at the same time the costs for Cable TV keep going up, along with that extra sports fee.
And you can see the results here in Anniston/Oxford, drive through any neighborhood here and you can see a lot of houses with satellite dishes. Heck, Dish Network has salespeople inside the local mall. And DirecTV has salespeople inside the local Wal-Mart’s, yes Wal-Mart. And I have talked to them and they acknowledge what Cable One has been doing, not caring about Cable TV, and they have seen more and more people going to satellite or AT&T Uverse. Several people are predicting that Cable One not caring about their Cable TV and steering towards broadband could mean that it could discourage potential buyers.
Yes, for now Cable One’s profits are higher mostly because it costs a lot less to maintain a broadband internet network than a cable TV network. But not caring about their video service could mean potential buyers might stay away from Cable One, and the Anniston/Oxford metro could be stuck with Cable One, who is on a weird mission to quit caring about cable TV and only care about internet. I wonder how long until Cable One decides to dump another group of TV channels from a network provider because they cost too much? They have already done this with Viacom. They have almost done this with NBC Universal, and it’s just a matter of time until Cable One’s lineup gets even more boring.
One thing is for sure, if you live in Anniston, Oxford, or most of Calhoun County, be prepared to get satellite service or Uverse, unless you enjoy watching a crappy lineup of TV channels. But we can still be satisfied with one thing from Cable One, they do have good internet service, but that’s it!