Cable Services Dangle Bonuses

If this keeps up, you’ll be getting a new toaster when you upgrade your cable subscription.

Cablevision announced on Friday that members of its Optimum Rewards loyalty program now get a new perk: discounted car rentals from Hertz. The deal also offers free rental upgrades and free membership in Hertz Gold Plus Rewards.

Wow, when I sit down in front of my television, I often find myself thinking about renting a car. Not. I’m not saying that there isn’t value in this new partnership between the two partnerships, but I think it is a strong indication of just how lost the cable services are in general these days. Cablevision is in a particularly difficult situation in its New York City metropolitan market, because it faces competition on a number of fronts, and not just satellite services. According to The Bridge, Cablevision’s subscriber list has been slowly but steadily dropping since the fourth quarter of 2010. Most large cable services show similar results.

The cable services have to figure out how to deliver more perceived value to their subscribers while charging more for the same service due to increased retransmission fees, infrastructure maintenance, and other rising costs. They have to fight off the pressure for a la carte pricing of their enormous inventory of linear programming channels, while finding a way to get video on demand (VOD) offerings to compete with online streaming and DVD rental services. They certainly have a difficult task on their hands, but I’m not clear that putting the subscriber in the driver’s seat is the solution.