jstratt

Cable TV's Decline: Two Views

What I see on one hand is results that so far continue to grow for cable even in a poor economy. The cable industry is an industry people love to hate and writing positive articles on cable has not been fashionable for many years. Still year in and year out they continue to grow top line revenue.

As an example in 2000 cable companies were offering analog video and earning $30 monthly from these base customers. Then came High Speed Internet and Digital cable and the average customer was paying $60 a month. Today telephone has been added and a larger customer base exists of customers paying $110 per month.

The result is that cable companies are efficient at selling programming for content providers. To suggest that content providers are going to give away their product to undercut the huge revenue they get from cable companies seems unreasonable. On top of that their customers typically have to be cable customers first.

Capitally Challenged Stocks That Could Be Diluted or Extinguished

Thanks Alan, You make many excellent points. We are in a market that few if any have seen. I would like to think the downside is over. However I wouldnt bet all my capital on that!

We are in time that requires we preserve capital first. I am investing in places where earnings are visible looking forward. Also I am investing in areas where I think the value is much higher than the current price and I want the stock for long term purposes.

In this market planning for a 20% drop is a smart move.