The Housing Chronicles Blog: New Homes, New TV Experience: Help Your Buyers and Renters “Cut the Cord”

Tuesday, March 25, 2014

New Homes, New TV Experience: Help Your Buyers and Renters “Cut the Cord”

Like many American households today, when my local cable TV company first offered a generous incentive to sign up for a “triple play” including cable television, home phone and high-speed Internet service, I was eager to sign up.   At the time, the combination of bundling three bills into one plus the added benefit of promotional discounts for the latest technologies made the decision easy.

Today, however, a far different combination of seemingly sneaky fees which continue to increase almost monthly, unreliable service (including a voicemail service which recently erased all of my saved messages), and more competition through emerging technologies is making it much easier to ditch your local utility behemoth in favor of something else.

I’m certainly not alone in my frustration:  according to, ten percent of pay TV customers are planning to “cut the cord” in the year ahead -- although in a previous poll last year, just 0.1 percent of the eight percent making similar vows actually went through with it.

I imagine that the disconnect here between consumers’ intentions and actions is due to the assumed complexity of finding the right replacement services, but what better time to show households just how to ditch traditional pay TV and phone service providers than when they’re buying or renting a new home?

Moreover, what better way to build your brand to tech-savvy Millennials than to speak in a lexicon they already understand while also showing them a way to save money well after they’ve moved into one of your homes?  Then, a year down the line, when their friends are complaining about the constant fee hikes to due to ‘higher programming costs’ (especially for sports channels), they can brag about how their builder or apartment management company made ‘cutting the cord’ so easy.

Today, however, most builders, apartment landlords and HOAs continue to not only automatically refer their future residents to the local cable TV or telephone companies, but in some cases actually benefit financially by locking in their residents with ‘discounted’ yet mandatory service that can limit their choices for years.

While such sweetheart deals might have made sense when these triple-play services were first being rolled out, today these entrenched players are often dealing with out-dated cable boxes or cheaply made cable modems which assume the subscriber simply isn’t aware of competition from digital TV antennas, satellite content providers, Internet-connected gadgets for home phones or Internet companies like NetFlix, Amazon Video or Hulu which entertain for a fraction of the cost.   In that case, such pre-made agreements can start acting as a deterrent rather than an amenity.

For now, both early adopting consumers as well as the entrenched players are moving gradually beyond the status quo.  In 2007, about two million households were being tracked by Nielsen as ‘zero-TV’ homes, in which content was being consumed on alternative devices such as laptops, pads and smart phones.  By 2013, that total had more than doubled to five million, with over two-thirds watching content on non-TV devices even when three-quarters of them had a TV in the home.

Not surprisingly, while 36 percent cited cost as a factor for their TV-free lifestyle, another 31 percent simply weren’t interested in the content being offered on traditional networks, which underscores the complaint that most pay TV subscribers are being forced to pay for content they will never watch.

To keep subscribers from fleeing, pay TV companies are beginning to offer ‘watch anywhere’ apps which allow viewers to view television live or even set their DVRs so they don’t miss their favorite shows.  Similarly, when HBO rolled out HBOGo, the premium pay channel puts its entire library of original programming online to subscribers for access on multiple devices including Internet-enabled TVs, DVD players, smart phones and even gaming devices including the millions of Xbox 360 and PlayStation3 units sold over the past few years.  By broadening the scope of where its content can be seen, HBO can thus shift the balance of power back from distributor to content provider in which the method of distribution becomes almost irrelevant.

So what just can builders and apartment managers do to address this changing world?  Simply providing information on the alternatives to the usual mainstays would be a great start.   For example, many companies provide Internet-based home phone service (also known as VOIP) for a fraction of the cost charged by the usual suspects.  Plus, who wouldn’t want a free starter subscription to NetFlix or Hulu Plus as part of the welcome package in a connected world?

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