The American media panorama has formally crossed the Rubicon, in line with S&P World Market Intelligence’s annual Economics of Primary Cable report from its Kagan analysis unit. It’s a grim learn.
The U.S. cable community trade has formally entered the “decline stage of its life cycle,” a transition outlined by falling revenues, shrinking viewership, and an unprecedented restructuring of legacy property. Whereas the sector faces a troublesome monetary trajectory, the defining occasion is the high-stakes bidding battle for Warner Bros. Discovery (WBD), the place streaming big Netflix. and conventional powerhouse Paramount Skydance current two starkly totally different paths for the way forward for cable tv.
The inflection level recognized within the 2025 report is just not a sudden crash, however fairly a structural dismantling of the cable bundle that dominated leisure for many years. The WBD negotiations encapsulate this shift. Whereas Paramount Skydance goals to accumulate the corporate in its entirety, Netflix is bidding solely for WBD’s movie studio and streaming property. Ought to Netflix prevail, WBD’s cable property could be cut up off, successfully stranding the linear networks because the trade chief cannibalizes the content material engine for its digital platform.
“These decisions signify a shift in the media industry as companies abandon cable networks in favor of streaming services,” wrote S&P’s Scott Robson, who additionally famous that the “burgeoning free ad-supported television (FAST) industry also continues to evolve as owners of library video content increasingly look for monetization outlets outside of basic cable syndication.”
For the reason that “cord-cutting” motion ushered in by Netflix gathered steam, Robson famous that linear community TV has been beneath strain—subscriptions peaked all the way in which again in 2012. Trying again at 2025 now, he concluded, there’s no comeback in sight.
Mapping out the decline forward
This potential fracturing of WBD mirrors broader trade actions. Comcast is about to finalize the spinoff of its cable networks—excluding Bravo—right into a standalone entity named “Versant” on January 2, 2026. These strategic exits sign that main media conglomerates at the moment are prepared to “abandon cable networks in favor of streaming services,” a development accelerated by the August 2025 launches of the ESPN Limitless and FOX One streaming platforms, in line with S&P.
The monetary knowledge underpinning this migration is stark. In 2024, gross promoting income for cable networks fell 5.9% to $20.2 billion, the bottom degree recorded since 2007. Robson’s staff additionally estimated that affiliate payment income, or what TV operators pay to hold cable operators, fell almost 3% to roughly $38.7 billion. Maybe most telling is the subscriber metric: the common cable community noticed its subscriber base erode by 7.1% to 31.4 million properties.
Nonetheless, S&P emphasised that this “decline stage” forecasts a protracted, gradual bleedout fairly than a precipitous fall. “After digesting all the major events that took place in 2025, it is clear that the industry has reached a turning point,” Robson wrote. “That being said, our outlook does not call for a major collapse but rather a continued slow decline as the transition to streaming develops.”
S&P famous that regardless of the overarching downward development, the speed of pay TV subscription decline appeared to gradual in 2025, with the trade truly registering slight subscriber development within the third quarter.
Operators try to handle this descent by clinging to the trade’s final dependable life raft: reside sports activities. The yr 2026 looms massive, that includes each the Winter Olympics and the FIFA World Cup. Comcast has even relaunched NBCSN, packaging it right into a sports-centric bundle on YouTube TV to seize viewers who haven’t but migrated to its Peacock streaming service.
A separate S&P evaluation concluded that sports activities might not be a moat for the declining linear TV enterprise. “Live sports may not be the anchor that once kept consumers from cutting the video cord,” S&P’s Keith Nissen wrote.
Nissen cited an S&P survey that discovered 90% of households dropping conventional pay TV for sports activities over the previous yr have been sports activities followers, and almost two-thirds of them spent 5 or extra hours per week watching sports activities. “This serves as evidence that access to live sports is no longer a differentiator between traditional and virtual multichannel services.”
Robson warned that the friction between rising prices and falling worth has intensified, with 2025 marred by carriage disputes, together with blackouts of Walt Disney and TelevisaUnivision networks on YouTube TV, as distributors pushed again in opposition to rising charges for diminishing audiences.
As 2026 approaches, the trade outlook is one the place underperforming networks face relegation to costly tiers or outright closure.
The scenario is akin to an property sale for a once-grand mansion. The homeowners (media conglomerates) are systematically promoting off the furnishings (cable networks) and transferring essentially the most helpful heirlooms (premium content material and sports activities rights) into a contemporary condo throughout city (streaming), leaving the previous home to slowly empty out, room by room.
Editor’s word: The writer labored for Netflix from June 2024 by way of July 2025.
This story was initially featured on Fortune.com
