Media analyst: Cable bundle floor could be 25-35 million households

The popular media observer parlor game of guessing where the cable bundle will “bottom out” seemingly becomes grimmer by the year.

For awhile, many pundits guessed that the cable bundle, which currently sits at around 65 million households in the United States, would level off at around 50 million households. Now, it seems like that prediction is being revised downward. Appearing on The Varsity podcast with John Ourand, veteran media analyst Michael Nathanson of the firm MoffettNathanson suggested the floor for the cable bundle could be much lower than 50 million households.

“There’s two floors,” Nathanson said. “There’s the floor during the NFL season where basically churn is not that bad and there’s subscriber growth. …Literally when you get out of the NFL season, I turn to my wife and I’m like, ‘What are we paying for here?’ There’s so little value, for me, in that bundle, from everything not sports. Because the NFL’s so large, college football’s large, but after that I just think the floor’s — we thought 50 million was the floor, maybe 50 million’s the floor from September til January. But I think we’re going to blow through that when the seasons come to an end. I think that’s what’s going to happen. And the more you strip things like Colbert out of the equation, it’s really bad.

“I’ve had friends of mine that are not media industry people say to me, ‘Why isn’t there anything on anymore in linear? And why is all of this good stuff over in streaming?’ And I’m like, well, that’s the choice they’re making to de-emphasize their linear channels and put it on streaming. But they’re doing it at such a rapid rate of decline, I think 50 [million] is wrong, and I don’t know, 25 or 35 [million] is where we’re headed towards.”

That’s not exactly a shocking revelation considering most media companies, even longtime holdouts like ESPN and Fox, are launching direct-to-consumer streamers this year. But there’s still no clear alternative to the cable bundle that provides consumers with everything all in one place.

Until another company is able to find a solution to that problem, there will still be a market for the traditional cable bundle. It just seems that market will be smaller than what was once imagined.