Nearly 800,000 U.S. TV households 'cut the cord'

[John Picard]

Some of you have stated in various discussions that "cable TV would never go away", and I've always responded, "never say never".
Nearly 800,000 U.S. TV households 'cut the cord,' report says

Make no mistake: The big cable, satellite, and telco carriers are still sitting pretty with more than 100 million TV subscribers. Nevertheless, a new report claims that more and more viewers are "cutting the cord" in favor of watching their favorite shows via over-the-air antennas (remember those?), Netflix, or the Web.
TechCrunch has the scoop on a new report from the Toronto-based Convergence Consulting Group, and though the figures may not be a "serious threat" to the big cable and satellite carriers yet, the trend might eventually spell trouble for the like of Cablevision, Comcast, DirecTV, and Time Warner Cable.

To wit: Nearly 800,000 households in the U.S. have "cut the cord," dumping their cable, satellite, or telco TV providers (such as AT&T U-verse or Verizon FiOS) and turning instead to Web-based videos (like Hulu), downloadable shows (iTunes), by-mail subscription services (Netflix), or even good ol' over-the-air antennas for their favorite shows, according to the report.

Now, as TechCrunch points out, the estimated 800,000 cord cutters represent less than 1 percent of the 100 million U.S. households (give or take) currently subscribing to a cable/satellite/telco TV carrier, so it's not like we're talking a mass exodus here. But by the end of 2011, the report guesstimates, the number of cord-cutting households in the U.S. will double to about 1.6 million, and if the trend continues, well...

IIRC, there once was a company called Blockbuster that was at the top of the video and game rental industry, when along came Netflix and GameStop...

 

[Professor Zoom]

I've thought about cutting the cord. I do think it's the beginning of a trend of wrapping the internet and the TV watching experience together.

Network and Cable must be scrambling to figure out how to make money...

 

[stj]

We can't get but one broadcast channel in this area. Cable has been here since the Fifties, for good reason. It's not leaving our town.

 

[ParticleMan]

The current state of the economy probably has as much, if not more, to do with this than any attempt to move forward with newer technologies. People are realizing they are spending $75-100/month for multitudes of channels they don't even bother watching when they can spend less than $10/month combining web video and Netflix services to get basically the same product without all the filler...

I wonder if people will go back to subscription cable/satellite once things pick up? I'd guess probably not, but we'll see...

 

[John Picard]

We can't get but one broadcast channel in this area. Cable has been here since the Fifties, for good reason. It's not leaving our town.

You mean to tell me there is no broadband access in your area? You're tempting Fate by stating "not leaving our town", but what do you think will happen if/when the FCC gets the National Broadband Plan in action in the US.

Like I said, "Never say Never".

 

[LitmusDragon]

I've considered doing this from time to time. Basically I'm paying $100+ a month to catch one or two first-run shows as they air. It is wasteful in the grand scheme of things.

edit:
On second thought, cable is my best source of high-speed internet in my area. I can live without the cable but the internet? No. I need that.

 

[Warp Coil]

I did this two months ago. No regrets so far. I'm saving $80/month. I really only care about a select few TV shows - Lost, Caprica, Friday Night Lights - and I can watch them on Hulu for free. I also like Dexter and True Blood, but I never paid for the premium channels anyway so it's not like I was used to watching them by conventional means.

Between Hulu, Netflix and my own DVD collection I have plenty to keep me happy. I'm also reading books, playing video games, going to the gym, hanging out with friends and doing other things that eat up my time so it's not like I'm bored and need to sit on the couch and channel surf.

 

[bigdaddy]

So 800,000 people cut it since... the beginning of time? The article is stupid.

 

[Mr. Laser Beam]

I still have cable, mainly because I'm a baseball fan and MLB.TV is not exactly 100% reliable.

 

[stj]

We can't get but one broadcast channel in this area. Cable has been here since the Fifties, for good reason. It's not leaving our town.

You mean to tell me there is no broadband access in your area? You're tempting Fate by stating "not leaving our town", but what do you think will happen if/when the FCC gets the National Broadband Plan in action in the US.

Like I said, "Never say Never".

The cable company is the broadband access provider in this area. There is no independent broadband access here.

 

[tomalak301]

I still have cable, mainly because I'm a baseball fan and MLB.TV is not exactly 100% reliable.

If I wasn't so into Sports, I would probably do the same thing. I don't pay for the special packages, but even if I could, you can't get, say, the final round of the Masters or the Super Bowl online. And if you could, why would you want to watch something like that online.

This is why I wish there was an A la carte option. Smaller networks would never go for it, but we're paying so much for so much crap that it really isn't worth it.

 

[Mr. B]

Considering the current economic circumstances, 800,000 fewer customers in two years seems like a low number.

 

[Scout101]

Less than a percent, so not really much to try and draw a trend from, especially if you consider that some of it is likely a result of the current economic situation, and not because of choice or finding the internet/netflix more convenient...

 

[SlyCardie]

There are still a good amount of shows that don't appear online that I want to watch, but you're definitely right about the sports things. Crazy that so many people just stopped.

 

[Arrqh]

Less than a percent, so not really much to try and draw a trend from, especially if you consider that some of it is likely a result of the current economic situation, and not because of choice or finding the internet/netflix more convenient...

It's just a fraction of the market, but there's still enough data to pull out a general trend. It certainly doesn't mean the end is nigh for cable, of course.

Convergence Consulting Group said that cord-cutters currently represent less than three percent of people who watch full TV shows online—that's because the majority of Americans use online video to supplement their TV viewing habits, not replace them. This is good news for the networks and advertisers, as ad revenue on traditional broadcasts is still many orders of magnitude higher than what can be scraped together online. This much is evidenced by some of Hulu's troubles in keeping popular shows on its site and its ad bucket full.

Still, the number of US households going without satellite or cable is expected to reach 1.6 million by the end of 2011. These people are looking to iTunes, Netflix, over-the-air broadcasts, and other streaming options to take care of their needs—they're looking to DVD and Blu-ray less thanks to "tough economic times" and because Netflix, Redbox, and online options offer a lower value proposition.

That, of course, is the whole reason why content producers delay their DVD and online releases—they want to make as much money as possible from the traditional broadcast before they defer to lower-level revenue generators. And because content creators can do that, they will continue to do so forever—or until the online-only market becomes so large that it will be impossible to ignore. 1.6 million households in 2011 is pretty large, but it's not enough to tip the scale just yet.

http://arstechnica.com/media/news/2...rs-grow-but-barriers-still-exist-for-most.ars

 

[sidious618]

This isn't at all surprising with the economy how it is.

 

[KB24]

I agree that if it weren't for sports, I probably wouldn't have cable. I don't really watch any first run shows that can't be found elsewhere if need be. I don't often watch my On Demand option either. Generally I'm content with my own dvds, netflix, and the roku box.

The antenna angle in the article struck me the most. I suspect more people do this route,j ust plugging in and seeing what they can get. I'm sure now that's much better than when we were kids in the sticks with only the 3 networks, PBS, and if we really tried the rabbit ears, fox.

 

[Temis the Vorta]

Network and Cable must be scrambling to figure out how to make money...

Not cable, they're growing. Network TV is more vulnerable since they have no subscription revenue to offset declining viewership.

In theory, the downloading market will grow to compensate for the losses elsewhere, but those numbers are still very trivial compared with old fashioned ad revenues.

As for Netflix, it'll contribute to revenues indirectly, like DVD rentals and sales as a whole already do.

 

[Ryan]

There's not much concern since the majority of cable companies are also in the ISP business. They'll just start charging a "convenience" fee for customers like me who don't have cable bundled with their internet (not looking forward to that day).

I cut the cord a number of years ago and was kinda surprised how little I missed cable. When I'm at a friend's and they complain they've got 100 channels and nothing's on I like to remind them they're paying $800+ a year for that privilege.

 

[Sheep]

I cut the cord when I moved into my own place (no more housemate to split the cost) and couldn't justify an extra $60 a month (minimum) to subscribe to cable television.

I have an OTA HD antenna connected to my HTPC and broadband through Comcast for $50 a month which pretty much supplies all the entertainment I need (broadcast TV, Netflix streaming, Xbox Live, the occasional torrent). I don't miss cable one bit, much to my own surprise.