Cord-Cutting Will Only Continue As Cable Prices Rise

Image courtesy of Ingrid Taylar

Nearly half of Americans with pay-TV packages are nearing the point of saying goodbye to traditional cable, including those few are actually satisfied with their service. Why? Because their cable bills just keep going up.

This is according to the latest Video Trends report from TiVo. The company has run the video trends survey every quarter since 2012, so it now has about five years’ worth of data to look at. And while some variation from year to year and quarter to quarter can obviously just be noise, the trend seems clear: Viewers are sick of high cable costs, and happily switching to online options.

One of the most interesting questions asks whether current cable or satellite subscribers intend to stay that way. 48.9% — almost half — said that they either were actively planning to cut service or switch to online services only, or were open to considering it.

(An unscientific poll we ran in 2016 found that 51% of Consumerist respondents were similarly open to cord-cutting down the line.)

For those who have already cut the cord, the vast majority cited cost as a primary factor. Nearly 80% of respondents (79.7%) said that “price / too expensive” was why they cancelled.

Nearly 60% are still getting their content, though: 57.6% of respondents also gave the second most-cited answer — “I use an internet streaming service” like Hulu, Amazon, Netflix, etc. About a third — 32.5% — also said that they use an antenna to get broadcast channels on their TVs.

More interesting: Just since the fourth quarter of 2016, only three months earlier, the number of folks saying they use an internet service went up more than 9%, and the number of folks using an antenna went up more than 5%.

Perhaps that’s because prices seem to keep going up. All together, just over 37% of the survey respondents with cable or satellite packages were paying more than $101 per month for their service — but only 23.7% rated themselves as “very satisfied” with what they get.

Among those who were actively dissatisfied (22%), 81.4% said that it was too expensive or they were unhappy with increasing fees for the service — nearly a 10% increase as compared to the first three months of 2016.

Respondents also indicated that they’re pretty much sick of bundles: A whopping 77% said they would prefer to be only to put the channels they actually want to actively watch into their cable packages, known as the à la carte option. And it’s easy to see why — not only do consumers think it will lower their costs (it might not), but 83.5% said that of the channels available to them, they watch 10 or fewer regularly.

And while conventional wisdom always says that cable and satellite subscribers mostly want it for the live sports, that doesn’t seem to mean they care much about cable sports networks. TiVo’s survey asked respondents what channels they would put into an à la carte bundle if they were going to build one from scratch. On average, the report notes, viewers selected 19 channels — and ESPN came in 17th out of the top 20.

Instead, the top five are largely the broadcast networks, with a couple of cable stalwarts mixed in:

  1. ABC: 58.4%
  2. Discovery Channel: 56.6%
  3. CBS: 54.1%
  4. History: 52.5%
  5. NBC: 52%

That’s about the same list as every year, TiVo notes, although the order of preference may shift around. Some of the other networks that outranked ESPN include PBS, A&E, TBS, TNT, AMC, HBO, National Geographic, and Fox.

“With more options than ever for TV in 2017, consumers continue to get smarter about their TV options, and many have discovered ways to access TV for far less than $100 a month,” the report notes, citing options like Dish’s SlingTV, DirecTV Now, PlayStation Vue, and the new cable-like options from Hulu and YouTube.

The survey also indicates that consumers are, indeed, watching digital options. Just over 54% said they have a Netflix subscription, 27% said they have an Amazon Prime video subscription, and just under 12% have Hulu subscriptions. For the over-the-top bundle services, the numbers were lower: 2.2% subscribe to DirecTV Now, 1.5% to Sling TV, and 1.4% to PlayStation Vue, TiVo found. And of those who pay for some kind of streaming video on-demand service, more than 93% use them for at least an hour a day.