Cord Cutting Has Utterly Exploded During the Covid Crisis
from the accelerated-evolution dept
The cable industry was already struggling last year, when a record number of cable customers “cut the cord” and flocked to over the air or streaming alternatives. That was before a pandemic came to town. Now, with some sports on hiatus and folks desperate to cut costs, the trend has only accelerated, to the point where 6 million Americans are poised to cut the cord this year alone:
“By the end of this year, 31.2 million US households will have cut the cable TV cord in aggregate. And 6.6 million households will cancel their pay TV subscriptions. By 2024, more than one-third of US households will have cut the pay TV cord.”
The first quarter of 2020 alone saw more than 1.8 million users cancel traditional cable — a record. That’s fairly impressive for a trend cable industry executives (and the folks at places like Nielsen paid to tell them what they want to hear) spent years trying to pretend wasn’t happening, then tried to downplay it as something only losers do. Late last year, a lot of cable executives made headlines by trying to claim the shift was coming to an end. Charter CEO Tom Rutledge, for example, offered up this prediction last November:
“I think in aggregate they?re going to slow down,? said Rutledge. ?Because I think most single-family homes have big TVs in them and that?s where you get sports, that?s where you get news, that?s where you get live TV like this. It?s still going to be under price pressure. I?m not saying the category isn?t under pressure. But I think the rate of decline will slow.”
It didn’t slow. And there was absolutely no indication a slowdown was coming, even before Covid-19 came to town. The number of folks still paying for traditional cable has now dropped 22.8% from pay TV’s peak back in 2014. But by the end of 2024, analysts expect that fewer than half of US homes will subscribe to a traditional pay TV service. That is, I believe, the opposite of “slowing down.”
To be clear, the cable TV sector still lays claim to 77 million subscribers in the United States, even though that’s a drop of 7.5% year over year (another record). And many of the biggest companies (like AT&T, Verizon, and Comcast) should be fine, given they can just jack up the price for broadband thanks to regional monopolies over internet service. But with competition heating up in streaming, and consumer financial headaches likely persisting throughout 2020, downplaying or ignoring one of the biggest trends in TV history is no longer an option for some of the least liked companies in American industry.