In cable, it’s survival of the fittest as channels drop from the bundle

Web streaming is upending the neat arrangement long enjoyed between TV channels and cable providers such as Verizon and Comcast. Verizon pays ESPN and other channels a certain amount to carry their programming, a cost that gets factored into customers’ monthly bills. But with consumers complaining about paying for too many channels and switching to online streaming alternatives such as Netflix, cable firms are feeling the pressure to cut costs — and even drop channels, especially those with plummeting ratings.

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The swift decline in cable has been particularly harmful for Viacom, which typically presses cable distributors to run all of its channels — including MTV, VH1, Comedy Central and Nickelodeon — or none of them. The company announced this week that it will cancel some shows and lay off staff as part of a broad restructuring plan.

The retrenchment marks a change in fortune for the cable TV business, which in the 1990s created new opportunities for minority programs, local news and niche educational networks with small but dedicated numbers of fans. The rise of cable created new genres in TV around food, health and reality shows, launching networks such as HGTV, the Weather Channel and TruTV.

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