Internet Video

Cord-Cutting Risk Seen as Low in CEA Survey

6/06/2011 12:01 AM Eastern

Some 10% of pay TV households say
they plan to cancel their cable, satellite or telco
TV service this year, tapping Internet sources
of content, not over-the-air broadcasts, according
to research from the Consumer Electronics
Association.

CEA called out the findings on over-the-air
households, noting that currently 8% of all U.S.
TV households rely on broadcast TV. Th at represents
some 9 million homes, a number that
has been steadily declining since 2005, according
to the group.

SPECTRUM ANGLE

The trade group has been lobbying the U.S. government
to institute voluntary incentive auctions
for broadcast spectrum, arguing that it is a
resource better used for high-speed wireless data
services. CEA CEO Gary Shapiro said in a statement
with the survey results that “the only cord
being cut these days is the one to the antenna.”

The phone survey of 1,256 adults was conducted
in December 2010, using Opinion Research’s computer-
assisted telephone interviewing system.

National Association of Broadcasters spokesman Dennis
Wharton said “CEA has zero credibility when it comes
to calculating over-the-air TV viewership” and cited other
estimates that over-the-air exclusive
homes are more than 14% and rising.

The CEA said that, on the pay TV
front, about 76% of survey respondents
were “unlikely” or “very unlikely” to
cancel pay TV service in the next 12
months; 14% were “somewhat likely”
or “somewhat unlikely” to do so; and
10% were “likely” or “very likely” to cut
the cord.

Cable, satellite and telco TV services remain the most
popular source for video content, cited by 80% of respondents,
followed by: Blu-ray/DVD (72%), free video-on-demand
(45%), DVR (41%), paid VOD or pay-per-view (33%),
online sources such as YouTube (31%), free online TV
shows and movies such as from Hulu (27%), and paid online
services such as Netflix (22%).

Approx imately 96% of
U.S. households, or 114 million,
own a TV, the CEA estimates.
The report is available
at CESWeb.org.

‘GEN Y’ LEADS WAY

Another survey released last
week said pay TV providers were
most at risk of losing “Generation
Y” subscribers who are less
attached to traditional TV and
more willing to try other alternatives,
such as Hulu or Netflix.

That survey, of 500 people aged 18 to 29, was done in
February and March of this year by an independent research
group for marketing consultancy Ideas & Solutions!
of Los Angeles, founded by former cable and satellite-TV
executive Glen L. Friedman.

Customers deemed least likely to cut their pay TV service
represented the largest segment (40%). The remaining
60% were either leaning toward or seriously considering
cutting out their pay-TV subscriptions.

Friedman, in a release with the results, called 18-to-29-
year-olds “the demographic that completely transformed
the music and the phone business and has already started
to dramatically reshape the pay TV ecosystem.”


John Eggerton contributed to this story.

WHAT HOOKS PAY TV SUBS

A survey of 18-to-29-year-olds found these factors desirable
about multichannel-TV services:

• Sports programming

• Combining bills into one lump sum

• “Communal” aspects

• The “stumble upon” experience of browsing channels

SOURCE: Ideas & Solutions!

March