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Coming Soon: The Incredible Shrinking Video Bundle

Years after tech prognosticators said Web video would kill the cable bundle, the traditional subscription television service is proving resilient. 

U.S. paid television subscribers actually increased by a few hundred thousand in the first quarter of the 2014 compared to the first quarter of 2013. 

Rather than wrecking the bundle, in which cable and satellite television providers offer a big collection of channels for a flat monthly fee, technology companies are trying to co-opt it. Apple, Microsoft and others have been seeking deals to let customers view their existing programming through Apple or Microsoft hardware rather than building new video services from scratch.

But a new challenge to cable and satellite operators is emerging—smaller, cheaper bundles of television channels and other professional video. 

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But the threat explains why cable companies might finally be open to content-sharing deals with bigger tech companies like Apple and Microsoft. The all-you-can-eat bundle is likely to have a longer shelf life if it can be used with in more ways with more devices.

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The threat from micro-bundles explains why cable companies might finally be open to content-sharing deals with bigger tech companies like Apple and Microsoft.