The line is delivered with manic eagerness, capturing the strange intimacy customers once had with cable installers.
This was the early age of cable. A cable connection was a window to the world. It brought HBO and live sports to its audiences. The quality was far superior to old terrestrial TV in America. Terrestrial channels were few. Cable had over a hundred, ranging from MTV to live wrestling.
But the Cable Guy turns out to be a nuisance. He harasses the customer with crank calls. He plants stolen TV equipment in the man’s home. He even holds parties with high-class escorts there.
When the customer tries to cut ties, the Cable Guy retaliates by getting him arrested on trumped-up charges.
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This movie has been on my mind lately. Last week, I cancelled my StarHub cable TV subscription. I first signed up in 1998, when cable was provided by TCS (now Mediacorp) in Singapore. It was in the same era as that movie.
The customer in the movie struggles to cut off the Cable Guy. Despite the pranks and manipulation, the installer has a magnetic pull.
Likewise, cable TV’s arrival was joyous. I could watch cricket matches live from around the world. TV shows of that era — like Ally McBeal and The Bold and the Beautiful — were just a click away. There were endless movies for me to enjoy.
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Over the years, it became a menace. StarHub kept raising fees. Then streaming services like Netflix arrived around 2015–2017, followed by Apple TV and HBO Max.
Streaming content was fresh and expanding. You could watch Game of Thrones at your convenience. Streaming is around 80% cheaper than cable TV.
Cable TV has cost me over $20,000 since 1998. It’s fair to say I could have saved at least $8,000 by cutting the cord when Netflix came to the fore in 2017.
Like the hapless customer in the movie, I took my time. I feared losing access to BBC or CNBC. But there are now plenty of ways to get news and sports. Today, streaming dominates home entertainment.
Investors, however, may still want to keep an eye on cable. There are three listed cable-TV-linked platforms in the region: StarHub, Astro, and Asia Pay Television Trust (APTT). Astro is the pioneer of pay-TV in Malaysia. APTT is Taiwan’s cable operator with more than 175 channels. StarHub and Singtel have roughly equal shares of Singapore’s dwindling cableTV market.
These companies are trapped in a dying business. The trio have lost more than half their user base in the past five years. Their stocks now trade well below what a strategic or private-equity buyer might pay.
The de-rating has been swift and unforgiving. Astro’s share price has collapsed from over RM1.10 at IPO to below RM0.20 within four years. Minority investors have raised pointed questions about privatisation.
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APTT, meanwhile, trades around 10 Singapore cents with a 10% dividend yield supported by stable Taiwan cable cash flows. It has lost over 90% of its value in five years as streaming eroded its market share.
APTT’s high yield suggests the equity is being valued as run-off. This is a business kept alive for existing customers but no longer actively grown. The network is difficult to replicate. That kind of yield mispricing is ideal for buyout sponsors.
StarHub is in better shape than Astro. Its share price is down 12% in the last five years, underperforming the STI by 77%. Total returns are driven more by dividends than growth. StarHub was previously said to merge with M1, but with the latter now poised to be acquired by Simba, there are now murmurs of privatisation.
These businesses are cash-generative and asset-heavy. Their cash flows are predictable. This is ideal for private-equity buyers, who can restructure the companies, pivot to streaming, and harvest the cash.
I have cut the cord, but investors may want to keep watching.
Nirgunan Tiruchelvam is head of consumer and internet at Aletheia Capital and author of Investing in the Covid Era
