New Cord-Cutting Stats

Opinions vary widely on whether cord cutting and cord shaving are legitimate trends. And at a panel during Streaming Media East yesterday, execs from MTV, NBA Digital and Roku threw out new stats on the subject. According to Tom Gorke from MTV Networks, digital video is not a substitute for television. Even in its audience of so-called millennials (those born after 1980), MTV has found that the vast majority – 97 percent – are still consuming huge amounts of TV. Bryan Perez from NBA Digital, however, sees audience behavior that is more generationally divided. For those NBA Digital customers who only subscribe to content over broadband, there’s a split between consumers who paid for linear NBA content and then switched to Internet, and those who never paid for linear NBA programming before signing up for a digital package. The average age for consumers in the former group is 40 years old. The average age for consumers in the latter group is 32.

Meanwhile, Jim Funk from Roku reiterated a point made by Anthony Wood two weeks ago. New Roku customers report cord cutting or cord shaving at a rate of 30 to 40 forty percent. But what Funk emphasized was less that consumers are getting rid of cable, and more that the market is just fragmenting. There is more choice, and that means consumers are finding what they need in a variety of different ways.

In short, new stats do little to clear up the cord-cutting debate. Are more people watching more video online? Yes. Is it replacing TV? Probably not. Will it all shift further in the next 12 to 24 months? Absolutely.

24 thoughts on “New Cord-Cutting Stats”

  1. “Will it all shift further in the next 12 to 24 months? Absolutely.”

    Agreed. While I haven’t cut the cord, I have certainly shaved it, getting rid of DirecTV while keeping Cox Cable and combining their basic TV – and 25 Mbps broadband service – with multiple streaming devices (Roku, Xbox, PS3 and Apple TV) for a broad mix of receiving and consuming content.

    As I look in on different forums it is clear that many users, particularly the younger, more technically savvy consumers, are cutting/shaving the cord. However, I am not aware of any of my immediate friends, family or co-workers who are doing the same. While most have some idea of the ability to stream Netflix through a stand alone device, a television or a Blu-ray player, most are completely unaware – or have only the vaguest notion – of other services such as Hulu Plus, ESPN3, Pandora, Vudu, etc., and how all the various services and/or devices can augment or replace their traditional services.

  2. I like how some folks in the industry are playing word games. They’re saying cord cutting is a myth because people are keeping their broadband connections. This is like when I tell my daughter to stop jumping on the bed, and she says she wasn’t “jumping,” she was “bouncing.” The point is, the number of people cancelling their cable and satellite subscriptions and watching video that comes in over the airwaves or via the Internet is growing. So, let the industry play word games. All I know is that the amount I’m paying for video has dropped from $80 to $8.99 a month.

  3. Ditto.

    Moved from broadcast only cable to OTA after the digital transition.

    My Tivo accesses a whole bevy of online content, paid & free.

  4. With the possible exception of OTA HDTV, the dividing line continues to be between those who want high quality sound and video and those who don’t care. It’s laughable to compare even a compressed HDTV signal through cable with what I can get over the Internet.

    Wish I didn’t care though, it would certainly be cheaper not to.

  5. “With the possible exception of OTA HDTV, the dividing line continues to be between those who want high quality sound and video and those who don’t care.”

    Agreed that is one of the dividing lines. I used to spend considerable time in the Roku forums and one of my takeaways from that experience is that some number of consumers (hard to know what percentage) has taken the “good enough” attitude regarding audio and video quality. For that group, cost seems to be the overriding consideration. While I appreciate what Netflix offers for $9/month, for me, their “HD” quality is just good enough. The worst thing that could happen is for Netflix quality to become the de facto standard for content consumption. I appreciate and make use of various streaming services; however, the overall quality is pretty low right now. Unless/until streaming audio/video quality draws closer to at least cable HD feeds (and Blu-ray is another story entirely), I suspect most consumers will continue to opt for cable/satellite and physical Blu-ray discs based on their quality and consistency.

  6. “With the possible exception of OTA HDTV, the dividing line continues to be between those who want high quality sound and video and those who don’t care.”


    “It’s laughable to compare even a compressed HDTV signal through cable with what I can get over the Internet.”

    Yes and no.

    Netflix is shipping “good enough” streaming on their skimpy library of HD titles for a large lean-back flat panel.

    Netflix “good enough” 720 isn’t quite as good as wireline QAM, but of course, wireline QAM isn’t quite as good as Blu-Ray. The point is that Netlix has shown that you can stream “good enough” PQ over IP if you sweat the details, even if the underlying national infrastructure probably isn’t ready to support mass adoption by consumers.

  7. I go back and forth on this.

    Having cable you get:
    – ridiculously high bills (always seems like you’re paying about double of what you should)
    – a bunch of channels you don’t watch
    – a bunch of reruns
    – TV show seasons which run 12-14 episodes and they’re sporadic throughout the year where you’ll get like 5 new episodes in July and they’ll say, “Be sure to catch us next January!” and then you get 5 episodes in January and they’ll say, “Be sure to catch us in July!” (and they’ll pepper one or two around Halloween or Christmas). Makes it tough to keep up with what’s going on to the point where when the new episodes start you’ve forgotten and don’t care.
    – easy use of the TV. This is the reason I came back to cable last time. Yes, I can stream from Hulu, Netflix, random websites, etc. It works. It’s kind of a PITA, though. It’s not fluid. With TV + Cable DVR I can just watch my recorded shows and then get on with my life. With Hulu, Netflix, random website, I have to go search for my shows. How I Met Your Mother? Not on Hulu. But I can go find it on CBS – sometimes- (that happens with quite a few shows).

    Without cable I get:
    – no ridiculous bill
    – the above mentioned inconveniences of searching for TV to watch.

    So, I kind of straddle the line on this one.

  8. A few months ago my wife and I investigated cutting the chord, but decided not to because there is was no alternative / online source for many of the TV programs that she watches (from channels like HGTV and DIY). I don’t think that there will be a mass exodus from cable until a wider variety of programming is available online.

  9. I think about it, but with my wife and young kids in the house its better to pay the man, than manage the tech support.

    Also, my antenna situation isn’t ideal.

  10. My wife and I cut the cord over a year ago and it wasn’t nearly as painful as I expected. At first we found ourselves sitting on the couch, staring at the tv wondering what to watch but we pretty quickly found some new shows on PBS (to satisfy our Food Network/DIY cravings). I also started reading more books!

    We still miss some cable shows so we’ve started using Amazon and Hulu (free) to see those but we sure don’t miss the $85 cable bill!

  11. We stopped watching Live TV ever since I build my first htpc, and last year we shaved our cable to basic (just to get QAM). Our 2 year old is getting used to to the idea of selecting show and watching it later. I was considering getting Ceton card, but this would require going back to full cable service, which I do no want to do

    For most part quality of online video is acceptable and probably will get better in the future with new compression codecs. Online distribution will most likely become just another way of content delivery. It will not kill cable or Live TV as they are completely two different concepts. Just like TV did not killed the radio. The biggest obstacle are content owners. For now they are sticking with cable companies, but is just a matter of time until at least some of their products will be available online on paid basis or some form of subscription. Greed is a powerful thing, and they can see that some other companies making money online already

  12. AnotherDave: We have 2 kids in elementary school, and we cut the cord in January. The kids complained about losing some shows, but 95% of what they want is available via Netflix, Hulu, broadcast, etc., and they’re miserable when we visit the grandparents and they discover their TV has commercials.

    Our setup, in case anyone cares: A 5-year-old PC that serves as a PVR (with an antenna in the attic), a WD TV Live Hub in the living room and a Roku box upstairs. We use PlayOn to stream regular Hulu to the Hub.

    dwgsp: Hulu has a bunch of shows from HGTV and DIY.

  13. Interesting other side of the coin Merle re: ads. I cut the cord a while ago and after a small adjustment period, never looked back.

    I’ve been talking with a couple friends about doing the same. It’s still kindof a hodgepodge of solutions out there without a clear frontrunner I think. TiVo works best for me, in part because I have great OTA.

    I have blu-ray on one of my tv’s via a PS3. Found an interesting side note on physical media with my 4-year old. We were going to watch a blu-ray but he wanted to watch it on the other tv. When I said it wouldn’t work, he chose the other TV over the program and we streamed Netflix instead. Like the ads, something we try to avoid exposing the kids to anyway, I think there are many advantages that don’t get the exposure the deserve.

  14. Chucky wrote:
    “Netflix is shipping “good enough” streaming on their skimpy library of HD titles for a large lean-back flat panel.”

    If you have a good broadband connection and no interest in good sound, as I said.

    “Netflix “good enough” 720 isn’t quite as good as wireline QAM, but of course, wireline QAM isn’t quite as good as Blu-Ray. The point is that Netlix has shown that you can stream “good enough” PQ over IP if you sweat the details, even if the underlying national infrastructure probably isn’t ready to support mass adoption by consumers.”

    It isn’t good enough for me, that’s the problem. It definitely will be good enough for the vast majority of people, so to the other poster’s comment, that’s why people that want better quality are more or less screwed. This is a theme across a lot of technology today.

    In my case, I could live with Netflix picture quality if they had more in HD, had multi-channel sound, and the stream actually worked well. I don’t see the latter ever happening where I am in Columbus, since we have truly hideous broadband options.

  15. There’s very solid HD video content to be had. But you’re not going to get it with a flat rate a la Amazon Prime, Hulu Plus, or Netflix. Vudu and Xbox both have 1080p video downloads, and Amazon offers some good stuff as well. Of course, I have great broadband available to me. My biggest problem with Netflix isn’t quality anyway, it’s content selection as we all know. Also, for some situations, the lower quality is good enough – we watched Saturday Night Live on our smaller bedroom TV last night via Hulu Plus by way of Roku. That type of programming on the smaller screen was perfectly acceptable. But, for serious movie watching, it’d be a different story.

  16. While I’ve certainly shaved the cord some (canceled HBO and replaced it with Apple TV), I have to say that as usual with these things people need to be very careful about drawing conclusions based on their PERSONAL experience. There are LOTS of stats out there, and while there are a lot of numbers showing that cable for example has been losing customers for a while now (though not in the most recent quarter), MOST of those losses were actually not to OTT but to AT&T U-Verse or Verizon or Direct-TV or Dish. MediaBiz regularly covers these numbers through their Bridge feature, if you want to look at some back issues.

    Yes the trend towards OTT is obvious, but it is being WILDLY overplayed by of those covering it. Certainly there are generational aspects to it, but remember that a generation is like 20 years. This trend is going to play out over a very long time period. And there will be lots of little battles along the way–shows pulled from Hulu, fewer episodes available online, the “TV Everywhere” push from the cablecos, internet bandwidth caps from companies that offer both, the rise and fall of various brands of OTT STBs like Apple TV and Google and maybe even some more salvos from Microsoft and Sony. Its going to take a very long time.

  17. New numbers from AllThingsD interview here:

    with Roku VP where he says 15-20% of Roku owners have canceled their cable or satellite package after they bought their Roku device.

    Not saying this isn’t true, but just to compare the numbers, Roku says they hit 1 million units sold by the end of 2010 (all still in use? probably not) and 15-20% of that would be 150,000 to 200,000 units. With Comcast at about 23 million customers alone, this would be less than 1% of their subscribers. Not including TW, Charter, Direct TV, Dish, Cablevision, etc. So its entirely possible this number is true, and yet still not that measurably in the entire Pay TV universe.

  18. It’s even easier to cut the cord than you think. A fact remains that Americans watch only 10% of what they subscribe to on cable. At the rate cable bills are increasing, a quality OTA antenna is a better investment that pays a return each month you use it.

    Frankly, I don’t think the cable/satellite industry is being honest about the real numbers in the cord-cutting trend. I had Internet and TV+DVR with Comcast and our bill was about $150/month! Ridiculous, and over time, we got real tired of paying that. I don’t watch much TV (my wife does) but the internet is king for me. FiOS moved into our neighborhood and was begging us for our business. Months later, I called Comcast to end our video service, and I was intent on remaining an Internet customer, but I got an aweful attitude from the lady on the other end of the phone. She frankly told me that they would spank me a $150 early termination fee (even if I kept the internet) because i was ending video service. To add salt to this open wound, she then went on to tell me that the cost of my internet would rise from $50 to $67/month! Why would I stay? I told her FiOS was on my street and i could get a faster connection with them for $50/month no commitment. I told her that I would be willing to remain an internet/only customer if they could keep my internet bill at $50 like I had been paying all along. She then told me “well, I’ve gotten a lot of calls for video disconnects, I wasn’t able to do anything for them, what makes you think I could do anything for you?” That was the last straw for me – I told her to completely terminate my service. 3 days later we had FiOS and i built and installed an antenna system with distribution amp – which feeds all our TV outlets. We only pay $50 for Internet, and NOTHING for TV OTA – which actually has BETTER HDTV because OTA signals aren’t as compressed as cable QAM! Add to that, I built a multi-room MythTV HTPC system with 4 tuners – and this services all TVs in our big victorian house! We aren’t missing cable or looking back. we get 34 digital stations, and 90% of them are in HD! Among all those stations, my wife is able to watch all her shows and hasn’t noticed a difference, except a sharper picture and no $150 cable bill!

    I have been building and selling these antennas to people near where we live and they are also doing the same thing. Though I make a few bucks from the sale of the antennas, I enjoy the fact that i am liberating members of my community from the evil cable/satellite empire & empowering them with options.

  19. We cut the cord 18 months ago, I just got sick of paying $130 for basic cable and internet. I was fortunate enough to live in building were we have dual cable providers so I switched to the competitor at $29.99 a month (now $36 still a $100ish less than TWC). We have QAM but never watch it, in fact Netflix and provide 99% of our video traffic, and i’m about to re-purpose the QAM box into a generic server.

    As far as Netflix not being ‘good enough’ quality, well sir, go buy blue-rays, because the rest think it’s fine, thanks. That reminds me of the CD vs MP3 debate (and also vynle vs CD)

  20. we cut our pay tv back in early 2009 the cost just kept going up and the customer service was horrible, I just got tired of paying a premium for no premium we didnt even have hbo or show time and we were paying 65.00 dollars a month with no internet

    so I built me a computer specially for watching tv on the internet then cancelled cable and set up a deal with at that time at&t dsl it took me a while to find out were to go and what to watch and how to do it but once we found it out

    it was pretty simple to do and since 2009 i can tell you the quality of the video has improved a great deal with internet improvements from dsl to Uverse as well as companies jumping on board and advertising it has made leaps and bounds just in a few short years

    we no longer use the computer for tv and now use a Roku box which is also a improvement to a remote from a wireless keyboard and mouse the UI is more efficient and it just feels more legit and “less Tech work for me” no more late nights hey how do you do this from the in laws or the wife and kids

    I can see it advancing and I agree 2011 should be interesting to see were things go but I have a feeling 2012 will be the leaps and bounds year every one is still drawing the battle lines 2011 is going to be the legal year were contracts and lawyers and obligations set the stage for 2012

  21. I cut the cord to cable about 18 months now. My setup is as follows:
    I live in the bay area and plenty of Over The Air Broadcasting.
    Picked up an 8 bay antenna on Craigslist for $15. Mounted on the roof. connected the coax to the existing cable connections which feed the rest of the house. I installed a pre amp to strengthen the signal throughout the house.

    The HD is immaculate(not compressed like cable or satellite)…including
    All the major networks….NBC, FOX, CBS, ABC
    CW, ION TV, ME-TV, Bounce TV and local independents
    3 sets of PBS stations as well

    My 46″ Samsung LED LCD is internet ready
    I have Netflix streaming
    I also installed a VGA switch and ran a cable to the TV as an option

    Let’s see with a basic cable package of $50 a month (and I’m being conservative) I save $600 per year. I used some of the savings on a Channel Master OTA DVR. $300 at Walmart, no monthly fees.

    Total 1st year costs:
    $300 OTA DVR
    $65 Antenna pre amp
    $15 8 bay roof antenna from Craigslist
    $50 miscellaneous (antenna mast, new coax, etc.)
    $96 Netflix streaming for 1 year ($8 monthly)
    $526 Total
    still less than I would pay a year for basic cable at $50 a month, $600 for the year

    Years to follow…..$96 a month for Netflix streaming

Comments are closed.