Stories about “cord cutting” seem to be all the rage right now, but many of them are overlooking some pretty basic – and readily available facts – which suggest that consumers may enjoy online video but they certainly aren’t ditching their set-top boxes by the truckload (just the opposite).
But, before getting into some of the basic facts which show that cord cutting really isn’t happening – at least not how it is being described in many stories – it would be foolish not to acknowledge that more broadband users (including me) are looking at more and more video online, and that is one trend that will continue. As a cycling enthusiast, I’m even considering a subscription to www.cycling.tv. But will my desire to watch a few cycling races or other videos online replace the diverse cable package that my family enjoys? Not a chance.
And that’s because most of the content online doesn’t match my viewing preferences (and the vast majority isn’t age appropriate for my kids) and the experience is marginal at best when compared to the HDTV in my family room. And even though I work in the cable industry, I don’t think my personal experience is different than many others.
First, keep in mind that cable is the nation’s largest broadband provider so the more consumers that need a higher speed Internet connection to watch video online, cable is probably your best option.
But when examining if cord cutting is truly happening, I would recommend reading a recent Daisy Whitney column in TV Week with a headline that says it all, “Where Are Cord-Cutters? Signing Up for Cable, Satellite.” The takeaway – in the 4th Quarter of 2008, video subscribers increased by 441,000. And for all of 2008, Sanford Bernstein analyst Craig Moffett reports that video subscribers rose by 1.3 million subscriptions, and he says, “cord cutting remains the province of urban myth.”
When it comes to TV viewing, Nielsen’s Three Screen Report also demonstrates that consumers are watching more video than ever, now up to 151 hours per month on TV alone. Viewing of online and mobile video is also growing, but it’s only up to 3 hours per month online and 4 hours per month on mobile phones and other devices:
Viewers appear to be choosing the ‘best screen available’ for their video consumption, weighing a variety of factors, including the quality of the screen experience, convenience, availability of the video, and the ability to watch according to the consumers’ schedule. In the majority of cases, consumers choose to view video through the traditional means – live viewing of television in the home.
So, the data looks pretty clear yet we keep seeing headlines about Internet TV becoming the new mass medium. I guess the point here is to use caution (and facts) before coining the next trend.