The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, Abbott Laboratories and AbbVie, La Monica does not own positions in any individual stocks.
This is a wonderful time to be a consumer of content.
If you are tech savvy, you can get rid of pricey monthly cable plans and use devices like Roku or Apple (AAPL) TV and streaming video services like Netflix (NFLX), Hulu or Amazon's (AMZN) Prime Instant Video to only watch the shows you want, when you want.
I haven't even mentioned Aereo, the supposed broadcast TV killer that allows subscribers to watch and record live local TV online.
Cutting the cord is undoubtedly a trend. But is it really so prevalent that big cable and satellite TV companies need to be scared witless? Not yet.
Consider this: Shares of Comcast (CMCSA), the nation's largest cable provider, hit an all-time high this week. Shares are up nearly 30% in 2013.
Comcast will report its third quarter results on Wednesday morning. Analysts are expecting earnings per share to increase nearly 33% from a year ago.
Yes, Comcast is not merely a distributor of programming. It's not entirely dependent on subscribers for cable and high speed Internet services. It is also a content production powerhouse thanks to its purchase of NBCUniversal from General Electric (GE).
But Comcast isn't the only old-school TV company that's being rewarded by Wall Street. Several cable and satellite firms that don't have huge content-producing subsidiaries are also surging.
If this is what it looks like to be a dying business, then there are plenty of other companies out there that would love to have some nails driven into their coffin.
Now I'm not trying to suggest that the cable and satellite TV firms have nothing to fear from disruptive technology like Netflix and Aereo. But for the past few decades, the old TV firms have found a knack for adapting to and eventually embracing innovation.
Remember when TiVo (TIVO) was supposed to be the death of television? The digital video recorder company is no longer a verb like Google (GOOG) or Kleenex. Every cable and satellite TV company now has DVR technology built into their own set-top boxes.
It's possible that Aereo could suffer the same fate.
Sure, several big media firms are battling Aereo in court. They are challenging whether it is legal for Aereo to use tiny antennas to capture on-air broadcast TV signals and retransmitting them to Aereo subscribers without paying fees to the broadcasters.
But what's more interesting is that it appears several cable and satellite firms have realized that it's probably a better idea to just build a better Aereo instead of shutting it down.
According to a Bloomberg report last week, DirecTV, Time Warner Cable and Charter Communications (CHTR) are mulling whether to start their own Aereo-like service. The report also suggested that Time Warner Cable may even want to buy Aereo outright.
There are also rumors that Netflix may partner with cable companies to bundle streaming video services in set-top boxes.
So even if more consumers are looking to ditch cable or satellite providers, these companies appear to be doing their best to stay ahead of that and offer consumers the types of services they are more likely to want.
In other words, cable is not dead yet. All the talk of cutting the cord may be overblown. Think about it. It's much cooler to talk about how you got rid of your cable service and only watch streaming video with your brand new Google Chromecast.
But there are millions of people (me included) still paying monthly bills to Big Cable or Satellite for many reasons.
And they will probably keep doing so for the foreseeable future. They just don't brag about it since we live in a culture where Luddites are ridiculed. You subscribe to cable? Do you read hardcover books as well? (I do.)
While paying for TV programming a la carte is alluring in theory, it's a lot of work. Some of us are too busy with other things in our lives to try and figure out what shows are available where. (Breaking Bad on Netflix? Yes. Downton Abbey? Gotta go to Amazon.)
Some people still like local TV without having to use a computer to watch the 11 p.m. news.
And in some cases, the lofty price for content is worth it.
My wife and I happily shell out big bucks during the fall and winter to get NFL Sunday Ticket from DirecTV. Mrs. Buzz, a Western New York native, needs to masochistically watch her beloved Buffalo Bills from the comfort of our living room.
I know we're not alone. And investors know that too. That's why the cable and satellite TV stocks are not priced as if Netflix and Aereo are about to make them obsolete.
If you want your MTV and you are a DirecTV subscriber, you are out of luck. But what if you are like me? I stopped watching MTV in the early 90s -- you know when the M no longer really stood for music. I have DirecTV and am shedding no tears over the fact that I can't watch "Snooki & JWOWW." But it sure would be nice to be able MOREPaul R. La Monica - Jul 19, 2012 12:47 PM ET
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