The thorny issue of subscribers ‘cutting the cord‘ has been raised before and quickly shot down again. Usually by the cable companies themselves. However a new report from In-Stat research shows that internet tv could convince 30% of US homes to become cord cutters.
Online much cheaper than cable..
The report showed a slowing of growth of only 0.15% subscribers for last year. But the news was bad for cable who saw a loss of 2.5 million paying subscribers. But because there was a rise of satellite and IPTV subscribtions. The report also showed that homes were actually adding premium channels more than dropping them from the monthly bill.
So why does this report indicate cord cutting becoming more common? It is because the trend from subscribers in this report, is common amongst users who then bail out of the monthly fees or at least cut down on the channels to get a lower bill.
Says Keith Nissen, In-Stat‘s Principal Analyst:- “It is important to track these ‘at risk’ subscribers, rather than the pay-TV subscriber base as a whole. In general, our new data confirms that adoption of online video is growing. But, except for Netflix, the frequency of use is not expanding. This is largely because consumers are going to online portals to view specific TV and movie content. The frequency of viewing online video will probably not increase until ‘must-see’ original online programming takes hold.”
Sporting events are also failing to keep subscribers happy, which has always been the main motivation for keeping up the subscription. Sport is now less important to viewers as TV-on-demand and premium channels.
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So if online TV providers can get premium content delivered at a lower price, then it may just be a matter of time before the floodgates open. Could explain why Netflix are spending so much cash on premium content?