Commentary
Cable Bills Rise, But Customers Don't Cut Cords
- by Daisy Whitney , Op-Ed Contributor, July 10, 2012
American video consumers are able to shoehorn a lot of traditional TV viewing, mobile phone watching, and online video-ing into their waking hours, as evidenced by Netflix’s newest viewing stat, coupled with fresh research on multichannel services.
A just-released research study from Leichtman Research Group reports that 87% of U.S. homes subscribe to a multichannel video service (the operative word being video, which means they are watching TV, not just subscribing to broadband service from a Comcast or a Time Warner). That number has remained steady for the past two years, underscoring that consumers are not cutting the cord or even shaving it much as they boost their online video intake. In fact, the percent of homes subscribing to a multichannel video service is up from 80% in 2004, Leichtman said.
The continued strength of cable TV and satellite services comes at the same time that online video and Netflix usage is skyrocketing. Last week, Netflix reported that its users had streamed more than 1 billion hours in June, a new record for the company. Those 1 billion hours also translate into about 40 hours each month per Netflix U.S. subscriber and well up from the more than 2 billion hours Netflix reported streaming in the fourth quarter of last year. The 1 billion figure in June also makes Netflix the most-viewed cable network on TV, adjusting for distribution, said Richard Greenfield, analyst with BTIG.
Back on the multichannel front, Leichtman found that the average multichannel video bill rose 7% since last year to $78.63.
A self-report phone survey is hardly the most accurate indicator. Surely the MSOs can put a hard number on it.
#1 Rule: Make it easy. It is not easy for most people to figure out what to do when to do where to do how to do to get the programs they want to watch set up the way they have it now. There is opportunity out there.
There is bound to be a point at which consumers will finally rebel against cable's high prices, poor customer support and poor program options. The question is when?
I think it will be healthy when it does get past early adopter (cutter) stage.
Lets face it. None of the OTT services/boxes are a true competitor to a cable box with a DVR. Its too hard to find good content, and there is, in reality, a limited amount available. You simply cannot replace a cable box with a Roku box if you watch a significant amount of TV content....yet.