Stratechery Cable's Last Laugh
May 10, 2022
Discover the surprising resilience of the cable industry as it evolved from its post-WWII roots to its current state. Explore the transition from basic cable to advanced coaxial and satellite systems, and how competitors are adapting to rise of streaming. Learn about Verizon's pivotal role in reshaping partnerships and the strategies cable companies are using to navigate a world moving away from traditional bundles. Finally, delve into how these firms are now leveraging internet service bundles to remain competitive in the ongoing media landscape.
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Cable's Origins
- Robert Tarleton, a radio shop owner, solved a TV reception problem in his town by stringing cable from a better reception area.
- This innovative solution led to the first commercial cable system, driven by high customer demand.
Cable's Compelling Business Model
- Cable's success comes from high demand for valued content, geographic monopolies, and a cycle of technological advancement.
- Satellites initially improved reception, but ironically, later advancements favored lower ground installations to avoid signal interference.
Cable's Evolution and Turner's Innovation
- Tarleton helped spread cable systems nationwide, initially retransmitting broadcasts before the rise of national cable channels.
- Ted Turner's WTCG, later TBS, capitalized on cable by buying programs locally but selling ads nationally.