Report: 1 in 10 Consumers Cut the Cord in the Past Year

A new report from the Consumer Technology Association (CTA) reveals that 1 in 10 primarily-younger consumers have cancelled their traditional pay-TV subscription services in favor of paid streaming content services on their computers and mobile devices

Nearly 11 percent of consumers reported that they have cancelled their pay-TV subscription in the past year, a new report from the Consumer Technology Association (CTA) found.

According to the survey, just over a quarter of those who switched cited the availability of lower cost viewing options as their reason for making the jump.

But the newly cord-free consumers weren’t alone.The report indicated that 21 percent of consumers said they haven’t had a service subscription for more than a year, with nearly a third of those saying their TV-watching habits didn’t justify the cost of maintaining a subscription.

The CTA survey also found that the balance between subscriptions to traditional pay-TV providers and video streaming services has continued to shift. Though a 61 percent majority of consumers still use cable, satellite and fiber-to-the-home as their content source, 46 percent of consumers said they receive content through paid video streaming services – a seven percentage point increase over the prior year.

Perhaps unsurprisingly, it appears that millennials are driving the change. According to the report, 62 percent of millennials choose paid video streaming services as their content source, whereas 71 percent of individuals age 35 and over choose traditional service providers.

Millennials are also influencing how content is viewed, with 57 percent expressing a preference for watching streamed content on their computer, tablet or smartphone. Across most types of video content, millennials (42 percent) are more likely to watch from non-traditional devices than adults age 35 and older (22 percent), the survey found.Additionally, 71 percent of millennials said they engage with social media while watching video content compared to 31 percent of adults 35 and older. The majority of millennials (70 percent) also said they watch content on a secondary screen during commercials in their programming, compared to just 38 percent of adults 35 and older.

However, 77 percent of respondents still said they would purchase a TV as their preferred device for content viewing.

“More than ever before, consumers – especially millennials – are using non-traditional devices such as computers, tablets and smartphones for content viewing,” CTA senior director of marketing reserach Steve Koenig said. “As technology continues to improve, consumer behaviors and expectations also evolve – but televisions still reign as the preferred viewing device in American households today.”

The CTA’s findings are consistent with a flurry or reports that have found cord-cutting and changes in TV viewing habits are on the rise.

In December, Tivo's Digitalsmiths research firm found 4.8 percent of people plan to cut their cable or satellite TV service during the quarter, up from 2.9 percent during the same quarter two years prior. Of the individuals surveyed who didn't have a pay-TV provider, 19.3 percent said they had cut the cord in the last 12 months, 42.1 percent said it had been longer than 12 months, and 38.6 percent  said they never had cable or satellite service. 

Source: CED