Some new survey data hints that “cord cutting” by cable TV subscribers isn’t merely a media-generated myth.
Of the 22% of Americans who claim they’ve cut back on pay TV services in the last 12 months, 32% have hooked up their computer to a TV set to watch Internet video on a bigger screen, according to the Pew Research Center’s Internet & American Life Project (see Cable Curtailers Inclined To Watch Net Video On TV: Survey). That compares with 23% of Internet users surveyed who have watched shows and movies online that have a PC-to-TV configuration for that purpose.
Should cable operators be concerned?
Well, yeah. The industry’s unease about the over-the-top threat, however small, is appropriate (see Internet TV: Where the Puck Is Moving).
The bottom isn’t exactly falling out of the pay-TV market (in Q2: FiOS TV was up 300K and U-verse TV was up 248K). But it’s short-sighted to write off the guys — and they are, it seems, mostly guys — who have canceled cable TV in favor of Hulu, iTunes, over-the-air stations or other sources as isolated cases of hobbyists geeks.
Which is why the industry has cooked up a way to try to neutralize the Web-video-to-TV threat: the “authentication” concept that’s been touted chiefly by Time Warner Inc. (TV Everywhere) and Comcast (On Demand Online) (see Comcast Swells Web-TV Roster).
The promise to subscribers is: more value for your pay-TV dollar. Want to hook your PC up to your TV and watch it there? Go right ahead! Programmers win no matter which screen their shows are viewed on because those count toward Nielsen C3 ratings (theoretically). And distributors keep cashing the checks from TV customers.
Then the question is, in what cases would TV Everywhere fail to inhibit cord-cutting?
Look, there have always been “cable nevers“: People who cannot be convinced to pay for TV, for whatever reason. Video delivered over the Internet, watched on a computer or through Sony TVs or Netflix-enabled devices or Boxee, is yet another reason to not pay for TV service.
But unless and until you can get a critical mass of premium programming, especially live sports, more conveniently and/or less expensively through other means, people will keep paying for packaged bundles of TV channels and content. And TV Everywhere, if it’s done correctly, should keep that tipping point balanced on the side of pay television.