According to a recent study, the number of consumers in North America who are cutting the pay TV cord in favor of OTT streaming video services is growing. TiVo subsidiary Digitalsmiths reports that 8.2 percent of survey respondents were no longer paying TV subscriptions as of 2014, a 1.3 percent increase over the previous year. Interestingly, an impressive 45.2 percent indicated that they downsized their cable or satellite TV bundles during the same period in the wake of paying for services such as Netflix, Hulu or Amazon Instant Video (a trend referred to as “cord shaving”).
“71.7 percent said that cable and satellite’s increasing fees left them unsatisfied. 38.1 percent said these companies offered poor customer service, and 33.8 percent said bad channel selection was to blame,” reports TechCrunch.
Meanwhile, 81.7 percent of those surveyed said they typically watch between 1 and 10 channels, and 39.7 percent of that group only watch 5 channels or fewer.
Some pay TV providers, including Verizon and Cablevision, have begun experimenting with a la carte offerings and skinny bundles to address cord cutting. According to the Digitalsmiths survey, 81.6 percent of respondents indicated they would prefer to pick the channels they watch. On average, they suggested an ideal price point of $38 per month.
Consumer awareness regarding cable alternatives is on an upswing, explains TechCrunch: “Over half (55.7 percent) of respondents were familiar with one or more of these services, with Hulu being the best-known with a 51 percent mindshare. Sling TV followed with 11.9 percent awareness, then PlayStation Vue (11.4 percent) and CBS’s offering (10.5 percent).”
The cost for accessing alternatives to traditional pay TV services is becoming more reasonable, as is the ease of finding a wider range of desired content.
According to Quartz, “You can now own streaming subscriptions to Netflix ($8), Hulu, Showtime, and HBO ($15) for a combined $40. Because Netflix and Hulu contain little overlap in content, and rivals HBO and Showtime have virtually no content overlap, you’re getting an excellent bang for your buck. Hulu recently inked deals to feature all future AMC shows and a number of FX shows, so, between the four services, you’d have HBO, Showtime, Netflix, AMC, and FX covered.”
However, those who are interested in live sports would need to consider other options such as Dish Network’s Sling TV, which includes ESPN in its $20 base package.