Status Quo: Pay TV Users Keep Cable, Satellite Subscriptions


Although new data suggests consumers are slowly abandoning pay TV services, one study says the vast majority intend to maintain traditional subscriptions with cable, satellite and telco TV/video companies.

While consumers increasingly are using new digital platforms -- the Internet, video-on-demand, new set-top box functions -- an annual study by TV researcher Frank Magid Associates says it is additive. The solid use of traditional TV delivery remains.

For example, it says only 10% of consumers express an interest in viewing a TV show and movie viewing from the Internet, viewed on a laptop, computer or tablet screen. Conversely, bigger traditional TV screens -- as well as new Internet connected services, AppleTV, Google TV, Roku, and others -- continue to fuel higher interest in traditional TV screening.

Although recent data has shown first-time declines in subscription TV (per a recent report by SNL Kagan), the Magid study notes only a 1% decline. Future indications are that only 3% of consumers may join this group, "suggesting a relatively stable subscriber base for traditional providers." It says only 2.5% of consumers use Internet content exclusively.



The real danger of new alternative video platforms is harming the DVD purchase and rentals business -- which continue to see price discounts, new low-priced kiosk DVD dealers and lower overall revenue.

Touting more strength for traditional TV with bigger screens and new technology, it says 8% of consumers are likely to purchase a 3D television set in the next 12 months. It estimates that roughly 5% of U.S homes will have a 3D television by the fall of 2011.

"As new video viewing platforms, such as instant streaming and mobile apps proliferate, consumers are simply adding them to their portfolio of video viewing options," stated Maryann Baldwin, vice president of Magid Media Futures.

"Our research indicates this is definitely not a zero-sum game," she adds. "At least at this point, it appears traditional subscription services and alternative viewing platforms can coexist with services like TV Everywhere locking in revenues for traditional providers."

1 comment about "Status Quo: Pay TV Users Keep Cable, Satellite Subscriptions".
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  1. Dean Collins from Cognation Inc, November 29, 2010 at 9:54 a.m.

    Hi Wayne, interesting timing with two "alternatives" finding themselves under legal issues this month in two seperate countries.

    any thoughts?

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