Study: Cable Cutting To Continue, Especially As Millennials Age

from the streaming-away dept

In all of the discussions about cord-cutting, it seems like many times we get lost in the weeds of specific details on certain angles or certain perceptions. Occasionally lost in all of this is the simple fact that the public ditching their cable TV subscriptions is happening and the pace at which it's happening is rising. The general curve has almost universally been up and, while the entertainment industry may want to talk about the peripherals, eventually they're going to have to get on board the reality train.

A recent study drives the point home yet again, finding that the pace of cord-cutting, particularly among younger demographics, is ramping up even higher.

The findings of a Media Consumption Survey were presented on Thursday at the Goldman Sachs 23rd Annual Communacopia Conference in New York by Mike Vorhaus at Frank N. Magid Associates. The survey was taken in early June. Among the wider population of those surveyed, those saying they intend to cut the cord was 2.9 percent, which might not sound like a lot, but would represent millions of customers and is more than the 2.2 percent in 2012 who said they would soon cancel pay TV.
A half-a-point jump over two years may not seem like a huge deal, but it really should be a clarion call for pay-TV providers. This is particularly the case when so many of these cord-cutters have cited dissatisfaction with the customer service at cable companies as one of the reasons for the move. In addition, younger consumers are reporting that the options available to them from streaming services like Netflix and YouTube satisfy their needs. Add to that how the television is moving into the background as the primary source of media consumption, and the industry better be getting a move on in terms of offering better streaming services.
The amount of people who say they can't live without their TV remains steady at 57 percent, but among 18-to-34-year-olds, TV as the primary medium for entertainment is down 40 percent to 21 percent. Those who say they can't live without their smartphones is up sharply in the last three years — from 22 percent to 50 percent. The survey also says that 59 percent of U.S. households pay for a subscription video-on-demand service, with Netflix representing 43 percent of them.
None of this may be surprising, but there's an Achilles' heel in all this that far too few people are discussing. I've said this before, but I'd be willing to bet that the moment that major professional American sports leaps heavily into any kind of reliable, consistent streaming option, that's going to be the end of cable subscribers at the levels of the modern era. Sports aside, or rather included, the sooner cable providers and content creators get on board with the internet as the primary distribution mechanism, the longer they survive.


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  • identicon
    Anonymous Coward, 12 Sep 2014 @ 6:17pm

    Pro football and college basketball are the only things that keep me on the hook. Give me an alternative and I'm gone. And I'm no millennial, I'm in my fifties.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 12 Sep 2014 @ 7:06pm

      Re:

      I'm a huge F1 fan and cutting the cable just before the season started was hard to do. Now 8 months later I miss it but have had the extra time to setup a full woodshop.

      Geezers rock!

      reply to this | link to this | view in chronology ]

      • icon
        ECA (profile), 12 Sep 2014 @ 9:15pm

        Re: Re:

        Lets ask a question first..
        WHO HERE, knows why we are cutting the cable??

        PAYING for channels we dont watch?

        REPEATS? repeats, repeats????

        Its just ?????? GARBAGE?

        The GOOD stuff we want ALWAYS gets cancelled?

        They dont listen to US about what we want to watch?

        ! corp owns 20 cable channels, and they ALL will have the same shows eventually, but NOT what we want to watch? For all the channels..they REPEAT over and over, channel to channel..

        They OWN the whole industry.. 7 corps own MOST of the broadcasters world wide..

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 14 Sep 2014 @ 12:35pm

          Re: Re: Re:

          Why... lousy interface, extremely slow reboots, poor image quality, 1/3 of every hour is commercials... cable and tv in general is bad with a few rare exceptions, which are no longer enough to justify keeping it. (TimeWarner NY)

          reply to this | link to this | view in chronology ]

    • identicon
      PRMan, 15 Sep 2014 @ 7:13am

      Re:

      For me it's the NHL (college football is already mostly online). I could get around it, but my Dad is 77 and can't figure out how to use a computer. Once he's gone, I'll almost certainly cut the cord.

      reply to this | link to this | view in chronology ]

  • identicon
    Guardian, 12 Sep 2014 @ 6:18pm

    maaalenian

    ya know crusty ancient parents that are next into a wooden box

    reply to this | link to this | view in chronology ]

  • identicon
    Joseph M. Durnal, 12 Sep 2014 @ 6:32pm

    Tried

    Live sports has been the biggest impediment. I was very close to getting rid of the cable TV service and only keeping internet. For years, that meant you could still receive local broadcast channels unencrypted, but just recently, they started encrypting those channels too, making the decision even more difficult.

    The good news is that live streaming of sports has become more common place, but then again, asking for your cable TV login to get those streams has also become more common.

    reply to this | link to this | view in chronology ]

  • icon
    jupiterkansas (profile), 12 Sep 2014 @ 6:41pm

    It's a simple numbers game. Once the spreadsheet shows that sports can make more money offering their own subscriptions rather than offering subscriptions through cable, they'll ditch cable in a millisecond.

    I think the biggest impediment to all this has been getting streaming and online content onto people's big screens instead of their computer screen, and they're finally making that happen.

    reply to this | link to this | view in chronology ]

  • identicon
    Guardian, 12 Sep 2014 @ 6:47pm

    @3 @4

    the biggest "impediment" is multimillion dollar players beating there wives

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 12 Sep 2014 @ 7:24pm

    Yup, live sports is all I keep cable for

    Once they bolt, so do I.

    reply to this | link to this | view in chronology ]

    • icon
      ECA (profile), 13 Sep 2014 @ 2:01am

      Re: Yup, live sports is all I keep cable for

      PARTS I hate about sports..

      1. its a public event..MADE PRIVATE..
      2. cant afford a seat to watch any of them..
      3. WHO selects the sports, sports one shows international sports. its WILD watching high speed badmitton, and Cricket, and other sports NOT SEEN in the USA.. the Olympic sports NOT Shown in the USA..
      4. What sport has enough room to handle 1% of those that wish to watch it LIVE?

      more if you wish..

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 12 Sep 2014 @ 7:54pm

    Aside from sports, there really is some great TV happening these days. Some on cable channels, a few on broadcast TV, more than several on premium cable channels, PBS has some very interesting stuff. And I'm okay paying for it with a cable subscription. Used to it, it can be convenient.

    But I also pay my cable service for OnDemand offerings. And here's where my gears truly grind: unskippable commercials crammed into repeats. Oh, their precious content...bugger that when it's hacked into pieces so I am paying twice (in fees and in eyeball time). This shouldn't be permitted. I found a remote control 'hack' that allows me to over-skip and backtrack, but I shouldn't have to do that. It still pisses me off.

    Also this last '3 episodes only' on demand of a series I missed out on, which is useless to me if I haven't caught any of the episodes previous. It's why I won't bother with Hulu, a bullshit, ad-laden (paid or not), network-hamstrung service if I ever saw one.

    Recently signed up for Netflix and THAT is how I want to see content: uninterrupted for a flat fee. If you're hacking up your precious content with commercials, you are PAID IN FULL. Anything more is double or triple dipping. I can read my bill where I'm being charged for equipment and services and a buck fifty for "broadcast fees".

    I'm no good at math, but I can tell when I'm being gouged.

    reply to this | link to this | view in chronology ]

  • icon
    Atkray (profile), 12 Sep 2014 @ 9:03pm

    The cable companies know this.

    The cable companies know the internet is going to be the primary distribution system going forward.


    That is why they are desperately trying to turn the internet into a locked down version of CableTV™©® where they make all the rules before they make the switch.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 13 Sep 2014 @ 8:44am

      Re: The cable companies know this.

      you mean ,owns the rules and the creators of the rules , wonders why they don't offer media servers instead of cable boxes proprietary venders only and locked down of course so , they can charge anyone who hacks it via CFAA and infringement.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 12 Sep 2014 @ 11:34pm

    I dropped cable a long time ago. Guess I was ahead of the curve on this one. I found I wasn't looking forward to much they had to offer month after month and once you had seen that show, it came back over and over. When I got to looking at what I was paying for what I was getting, it just wasn't cost effective. A radio does just as good for background noise and doesn't cost diddly in monthly charges.

    I find that I have much more peace in my life without the constant barrage of commercials. I don't miss sports, nor all these stupid series and reality shows that are anything but real. Nor do I feel like I've wasted my time watching some stupid show that leaves me wishing I had that time back.

    I suspect that the pro leagues of sports are going to face something similar in their future having hiked the prices up in paying all those multimillion dollar contracts. I also believe that many people are making a decision to save money by cutting entertainment. That seems to be backed up with the idea that the summer block busters aren't busting anything but low volumes of viewers.

    reply to this | link to this | view in chronology ]

  • identicon
    Jim, 13 Sep 2014 @ 12:12am

    It's not just the Internet...

    It's not whether the distribution is IP-based or coax-based, the real issue is not having to pay for a bundle. That's what dead...the concept of channels and channels full of things you don't watch.

    As far as sports are concerned, we're a long way from college conferences and pro leagues moving to the Internet. They'll never be able to get as much revenue as they can from the networks and cable channels. They know that sports is the only thing keeping them in business, as stated in the post, and they pay the leagues handsomely for that lifeline. I fear that people are going to have to fall out of love with sports in order to get to an a la carte world.

    Fortunately, not only recent events, but the trends of the past decade, show that popularity and ratings for all sports except football are down. Also, it appears that Canada may be willing to try a national experiment with a la carte TV, so for people like me who like some sports, but loathe others, the ability to pick and choose not only what entertainment I want to buy, but also the individual sporting events, this may be coming sooner rather than later.

    reply to this | link to this | view in chronology ]

    • identicon
      Lucinda, 13 Sep 2014 @ 10:23am

      Re: It's not just the Internet...

      I think you are exactly right. I would have cut the cord years ago but my husband is a big sports fan and the streaming options aren't great yet. We purchased MLB live last year and the streaming was spotty at best. I think once sports makes the jump, coax-based will disappear. People really only want to pay for what they watch and not extra. I don't think cost will go down in the long-run for the average viewer but they will be more satisfied with the content they are getting.

      reply to this | link to this | view in chronology ]

    • identicon
      PRMan, 15 Sep 2014 @ 7:18am

      Re: It's not just the Internet...

      The NHL had its highest ratings the past couple years...

      reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 13 Sep 2014 @ 2:02am

    In many countries

    SATELLITE is FREE..look up FREE TO PLAY on wiki..

    Why?
    Because installing 1000's of Antenna broadcast stations over Millions of miles, wont HIT everyone..

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 13 Sep 2014 @ 4:29am

    'the sooner cable providers and content creators get on board with the internet as the primary distribution mechanism, the longer they survive'

    this has been said about the entertainment industries for decades but they have totally ignored it and instead of adapting, they have bribed governments and law makers to do whatever they want to aid in the staying in the analogue age! new laws and ridiculously high penalties, in terms of money, family break-ups, prison time and loss of life have been the results! if any industry wanted to stay out of the digital age, it is this one! if any industry desperately needed to join the digital age, it is this one!
    the one thing i find so hard to understand is why the help being given, is being given, especially to the level it is! there hasn't been a single incident that i have come across where any government has actually said to this industry 'instead of us doing all these things to assist in your remaining decades behind everyone/everything else, why dont you join in? why dont you do something yourself to help yourself?' and the most important thing that hasn't come from any government is 'why should your industry be helped more than any other and why should we persecute and punish our ordinary citizens for doing something that has been part of human nature for millennia?

    reply to this | link to this | view in chronology ]

    • icon
      GEMont (profile), 15 Sep 2014 @ 2:41am

      Re:

      "the one thing i find so hard to understand is why the help being given"

      I don't see how you could possibly be confused about Why Government does the bidding of the Undertainment Industry.

      The Industry offers government members great chunks of money and promises of top level, high-paid employment in the industry, after the politicians leave government, in return for enacting the stupid laws that try and hold back the future.

      Government members simply accept this money and the promise of employment and then dutifully enact the laws that the industry writes up for them, and then get hired by the Industry when they retire from government.

      Where is the confusion??

      reply to this | link to this | view in chronology ]

  • icon
    Groaker (profile), 13 Sep 2014 @ 6:06am

    Cable cutting

    It is not just for the Millennials. It is not just about saving money (though that is not insignificant.) But more so about the product. Roku provides services either with the one time purchase of their box, or ala carte. That is what I have been looking for in cable since 1970.

    Cable provides endless repetition of a few shows which are primarily named "reality shows," while Roku provides thousands of high quality movies and series.

    The only downside of this is that, like cable, Roku is starting to add longer and longer commercials. While still shorter than the commercials of cable, the future seems to extrapolate that they will catch up.

    reply to this | link to this | view in chronology ]

    • identicon
      PRMan, 15 Sep 2014 @ 7:22am

      Re: Cable cutting

      "Roku" is adding commercials? Do you even understand what you are saying? Netflix on Roku - no commercials. Hulu Plus on Roku - commercials. Amazon on Roku - no commercials. Crackle on Roku - commercials.

      Other than that, I have no idea what you are talking about. Do you even actually have a Roku?

      reply to this | link to this | view in chronology ]

  • identicon
    Dreddsnik, 13 Sep 2014 @ 6:24am

    And there it is. The reason they fear neutrality. Their 'solution' is data caps .. or whatever they call them. If the only way to stay under a data cap is to purchase a cable subscription and use the cable companys' inferior streaming service the hope is that people will pay the extortion rate.

    reply to this | link to this | view in chronology ]

  • icon
    Mike Shore (profile), 13 Sep 2014 @ 11:31am

    Totally agree with the last bit. I cut my cable a few years ago and the only thing I miss is live events. There are a few sports streaming sites but they seem sketchy. I would much prefer a hi-def official channel for my sports.

    reply to this | link to this | view in chronology ]

  • icon
    tracyanne (profile), 13 Sep 2014 @ 3:50pm

    I dumped cable/satelite before I even signed up for it

    I took one look at what was on offer and decided I wasn't paying for a bunch of stuff I didn't want.

    Free to air TV isn't worth the price of the ads, so I don't watch that either.

    My Media server now provides everything I need.

    reply to this | link to this | view in chronology ]

  • icon
    CK20XX (profile), 13 Sep 2014 @ 5:51pm

    I stopped watching television entirely in 1999.

    After Animaniacs was canceled, there didn't seem to be any point to it anymore. What good shows have come along since then have been worth waiting out for their DVD box sets or similar collections.

    reply to this | link to this | view in chronology ]

  • identicon
    Roland, 13 Sep 2014 @ 7:12pm

    tribalism

    Sports, like politics & religion, is all about identifying oneself with "the team". This is a basic part of human psychology. Big Sports isn't going to change to streaming if they think it will impact their revenue stream, and fans aren't going to make the switch if it interferes with their impulse to "Take My Money, Please!". It's an addiction. Our Side is the Good Guys, the other side is the Bad Guys.

    reply to this | link to this | view in chronology ]

    • icon
      John Fenderson (profile), 15 Sep 2014 @ 11:22am

      Re: tribalism

      Yes, this is the aspect of sports that makes them terrifying to me. However, even if current fans don't switch (and my wife is a prime example of exactly that), might there be an impact on the development of new fans (our children are a prime example of exactly that.) Addiction and tribalism don't help if you never get hooked in the first place. And don't think our kids aren't into sports -- most of them very much are, but playing them, not so much watching them. None of them have (or will, for the one who hasn't moved out yet) get cable just so they can watch sports.

      reply to this | link to this | view in chronology ]

      • icon
        JoeyDerp (profile), 5 Oct 2014 @ 11:29pm

        Re: Re: tribalism

        It's not just sports though, nations behave the same way over resources like oil.. Or people fighting against each other over which religion they think is the winner.

        reply to this | link to this | view in chronology ]

  • identicon
    Jean, 14 Sep 2014 @ 8:31am

    Sports is joined at hop to cable

    Sports is wildly economically unsustainable. Estimates of the percentage of the cable bill that is goes to sports franchises range from fifteen to half.

    Sports are massively subsidized by those who do not watch sports under the current model. The leaders in sports would be insane to move from away an environment where everyone is force to pay every month for content we do now want and people we would rather not subsidize. There would be no funds going to sports from many households if it were not paid in the form of a tax.

    People who manage sports teams would be economically insane and complete babbling idiots to move from taxing a relatively captive population to actually having to sell that sportsball crap only to people who like it.

    Even the venues are paid for by taxes:
    http://www.popsci.com/technology/article/2012-12/who-pays-stadiums-infographic

    Some in areas where there is public investment in sports while more than one in three children go to bed hungry
    http://feedingamerica.org/hunger-in-america/hunger-studies/map-the-meal-gap.aspx

    Sports will not come off cable (and the public dole generally) of their own free will. Why move from a government-enforced monopoly to the free market when there are easy billions to be made?

    reply to this | link to this | view in chronology ]

    • identicon
      PRMan, 15 Sep 2014 @ 7:28am

      Re: Sports is joined at hop to cable

      Everyone who doesn't watch sports should absolutely cut the cord. Half your bill IS going to teams you don't watch.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 14 Sep 2014 @ 9:50pm

    Cable could easily reverse this trend by either cutting down its ridiculous cost or trying to be worth its current value. I know they always claim that if they allowed us to CHOOSE what channels to subscribe to, it would cost more. Time to prove it. Go ahead. Charge me $20 a channel, and I'll still save $40 on my cable bill every month.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 14 Sep 2014 @ 10:31pm

    Future trends are saying whether they want to or not, they aren't going to have a choice if everyone cuts the cord. It doesn't matter to me how they serve the bundled crap. At the price they are asking I don't want it.

    More importantly, this upcoming generation is cutting the cord or never getting it in record numbers. That tells you where the future is.

    Insanely high prices are coming to an end. Give it enough time that the revenue drops and they will be reconsidering what it takes to bring the public back.

    I've learned to live without it. It is now normal not to have a tv for me and I don't want one. I don't want the hassle of the commercial and I'm sure not going to pay for cable tv. I am no longer in the market for paying with eyeball time. I suspect that others are going to be feeling the same way when it comes time they are forced to make the change. By that time their product could well be devalued to the point they can't really afford to carry on. That would sure make my day that it caught up with them.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 Sep 2014 @ 2:27am

    Sport - a domesticated animal that is born with missing, or deformed body parts.

    I think that just about says it all.

    reply to this | link to this | view in chronology ]

  • identicon
    ZipP, 15 Sep 2014 @ 8:24am

    I hopped on the cordcutter bandwagon almost 2 years ago. I was sick of paying for a ton of channels I didn't watch. I am so thankful I discovered Rabbit TV because combined with Netflix and Hulu, it is the perfect addition to my cordcutter setup!

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 Sep 2014 @ 10:56am

    Under counting?

    I'm only one data point, but it may be contributing to under-counting of cordcutters. I technically didn't "cut the cord". I cancelled my AT&T service (which included TV), and signed up for ComCrap (Internet only). AT&T will only count me as a lost subscriber. Comcast will consider me an internet only subscriber, but a new subscriber none the less.

    I don't know if all of these cord cutter numbers count the industry in aggregate, or if they are only based on actual reported cord cutters (i.e. I call up my provider and say drop TV but keep internet)?

    reply to this | link to this | view in chronology ]

    • icon
      John Fenderson (profile), 15 Sep 2014 @ 11:25am

      Re: Under counting?

      Undercounting certainly happens. I subscribe to basic cable myself, although I haven't even hooked up the converter for it. I do so because it's cheaper to get internet service through Comcast if you get it bundled with cable TV. Since it's crazy expensive to begin with, any little bit helps.

      But I'm sure this means I'm counted as a cable TV subscriber instead of what I really am: a cord-cutter.

      reply to this | link to this | view in chronology ]

  • identicon
    Sweetie, 15 Sep 2014 @ 2:29pm

    Rabbit TV

    I was trying to join the "cord-cutting" movement for many years but it was hard to actually let go of my cable. One day I just finally had enough with the bill and cancelled. It was the best decision I ever made. Since then I have been able to watch TV on streaming sites. My favorite is Rabbit TV because of the affordable price and the great selection. They have current TV shows and classics that I used to watch growing up. Their movies are also good and they have live concerts and news stations on there too.

    reply to this | link to this | view in chronology ]

  • icon
    JoeyDerp (profile), 5 Oct 2014 @ 11:41pm

    VPN and DNS proxy

    The basics you need to cut the cord are a VPN and DNS proxy, right now I'm using IronSocket because they offer both at a low price. Sometimes all you need is a DNS proxy to unblock channels, and get the streaming media using your same connection.

    Other times you might need a VPN if your ISP is throttling your bandwidth for something like Netflix. Then you need a VPN to get around that and not a DNS proxy.

    reply to this | link to this | view in chronology ]


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