The U.S. media landscape has officially reached a pivotal turning point, according to S&P Global Market Intelligence’s annual report from its Kagan research unit. The report paints a bleak picture.
The U.S. cable network industry has formally entered the “decline stage of its lifecycle,” a phase marked by declining revenues, dwindling viewership, and an unparalleled overhaul of legacy assets. Though the sector faces a challenging financial path, the defining moment is the high-stakes bidding war for (WBD), where streaming giant Netflix and traditional heavyweight Paramount Skydance offer two sharply contrasting visions for cable TV’s future.
The turning point highlighted in the 2025 report isn’t a sudden collapse but rather a structural breakdown of the cable bundle that ruled entertainment for decades. The WBD negotiations embody this shift. While Paramount Skydance aims to acquire the company in full, Netflix is bidding exclusively for WBD’s film studio and streaming assets. If Netflix succeeds, WBD’s cable assets would be separated, effectively isolating the linear networks as the industry leader repurposes the content engine for its digital platform.
“These choices reflect a shift in the media industry as companies move away from cable networks toward streaming services,” wrote S&P’s Scott Robson, who also noted that the “growing free ad-supported television (FAST) industry continues to evolve as owners of library video content increasingly seek monetization avenues beyond basic cable syndication.”
Since the “cord-cutting” trend spurred by Netflix gained momentum, Robson observed that linear network TV has been under strain—subscriptions peaked as far back as 2012. Reflecting on 2025, he concluded there is no recovery in sight.
Mapping out the decline ahead
This potential split of WBD mirrors broader industry trends. [Company] is set to finalize the spinoff of its cable networks—excluding Bravo—into a standalone entity named “Versant” on January 2, 2026. These strategic divestments indicate that major media conglomerates are now willing to “abandon cable networks in favor of streaming services,” a trend accelerated by the August 2025 launches of the ESPN Unlimited and FOX One streaming platforms, per S&P.
The financial data underpinning this shift is striking. In 2024, cable networks’ gross advertising revenue dropped 5.9% to $20.2 billion, the lowest level since 2007. Robson’s team also estimated that affiliate fee revenue—what TV operators pay to carry cable channels—fell nearly 3% to around $38.7 billion. Perhaps most revealing is the subscriber metric: the average cable network saw its subscriber base shrink by 7.1% to 31.4 million households.
However, S&P stressed that this “decline stage” foresees a prolonged, gradual decline rather than a steep collapse. “After analyzing all major events of 2025, it is clear the industry has reached a turning point,” Robson wrote. “That said, our outlook does not predict a major collapse but rather a continued slow decline as the transition to streaming unfolds.”
S&P noted that despite the overall downward trend, the rate of pay TV subscription decline slowed in 2025, with the industry even posting slight subscriber growth in the third quarter.
Operators are trying to navigate this decline by holding onto the industry’s final dependable lifeline: live sports. The year 2026 is significant, featuring both the Winter Olympics and the FIFA World Cup. Comcast has even relaunched NBCSN, bundling it into a sports-focused package on [Provider] TV to attract viewers who haven’t yet moved to its Peacock streaming service.
A separate S&P analysis concluded that sports may no longer protect the struggling linear TV business. “Live sports may not be the anchor that once prevented consumers from cutting the video cord,” [Nissen] said.
Nissen cited an S&P survey finding that 90% of households that dropped traditional pay TV for sports in the past year were sports fans, and nearly two-thirds of them spent five or more hours weekly watching sports. “This shows that access to live sports is no longer a distinguishing factor between traditional and virtual multichannel services.”
Robson warned that the tension between rising costs and falling value has worsened, with 2025 marred by carriage disputes—including blackouts of Walt [Disney] and [other] networks on YouTube TV—as distributors resisted higher rates for shrinking audiences.
As 2026 approaches, the industry outlook is one where underperforming networks face being moved to expensive tiers or shuttered entirely.
The situation is like an estate sale for a once-grand mansion. The owners (media conglomerates) are methodically selling off the furniture (cable networks) and relocating the most valuable heirlooms (premium content and sports rights) to a modern apartment across town (streaming), leaving the old house to empty slowly, room by room.
Editor’s note: The author worked for Netflix from June 2024 through July 2025.