TDG: 40 Percent of U.S. Households Will Cut the Cord by 2030

Despite the increasing number of digital streaming services currently available, including Amazon, Hulu and Netflix, about 85 percent of U.S. households continue to subscribe to traditional cable television. However, The Diffusion Group suggests the tide is turning; the market analyst predicts that by 2030 as many as 40 percent of Americans will have cut the cord. TDG Research also expects the percentage of households subscribing to pay TV will drop to 60 percent during the same period. TDG suggests that by 2030, about 30 million households will be “without an MVPD service of any kind.”

“The future of residential pay-TV services will be wrought from an intensifying clash between virtual operators like Sling TV and DirecTV Now, and traditional cable, satellite, and telco pay-TV providers,” explains the press release. “Unfortunately the battle will be for a larger slice of a declining market.”

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“After the recession, many Americans were looking to cut unnecessary expenses, which kicked off a trend of cord cutting,” reports Motherboard. “Coupled with the rise of digital streaming services … these trends contributed to traditional pay TV’s decline, something TDG predicted back in 2010.”

Previously, “Internet subscriptions were an upsell from cable or telephone providers,” notes Motherboard, but now “Internet is the must-have, while cable or home phone are often a luxury add-on for Americans. Last year, the number of broadband households surpassed the number of legacy pay-TV households.”

According to TDG senior analyst Joel Espellen, “TDG said early on that the future of TV was an app. Unfortunately, most incumbent multi-channel video providers weren’t taking notes. The question is no longer if the future of TV is an app, but how quickly and economically incumbents can adapt to this truth and transition to an all-broadband app-based live multi-channel system.”