Commentary

Cord Cutting? Bah, Humbug! Magid Says Digital Video is Additive

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Only 1% of consumers report they have canceled subscription TV/Video services because they are accessing content instead on the Internet. According to the 2010 edition of the Frank N. Magid & Associates update on cross platform video use and consumer attitudes, cord cutting is likely a myth. Only 2.5% of U.S. media consumers use the Internet exclusively for their content. And only 3% of consumers are even considering leaving TV subscriptions for other video sources.

Instead, Magid is finding that the people who use alternative video sources like Web, mobile and streaming media boxes are also spending the most on traditional subscription services. The analysts argue that the statistics show that networks and cable providers should consider these digital alternatives additive. "The average American's capacity to consume video content is impressive," says Magid Media Futures VP Maryann Baldwin in a statement. "As new video platforms such as instant streaming and mobile apps proliferate, consumers are simply adding them to their portfolio of video viewing options."

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In fact the taste for traditional media on alternative platforms may be lower than some presume. Magid's survey of 1,208 adults age 12 and over found that only 10% of respondents were interested in seeing TV and movie content on computer screens and mobile devices like tablets. Actually, they find there is a surge in interest instead in bringing this and other video on demand content to the TV screen via a connected PC. Interest in converging video on the TV is even higher when consumers are asked about dedicated streaming media boxes like Roku, Apple TV, Google TV and Boxee

Video is not a zero-sum game...at least for now and at least not for traditional TV broadcasts. DVDs continue to be most at risk from these new platforms, Magid says. The arrival of 3D TV is tracking slowly but not unlike the adoption curve of HDTV years ago, Magid says. Only 8% of those surveyed said they expected to buy a 3D TV in the next 12 months. Compared to a similar level of interest in the first year HDTV were offered, Magid finds that generally only 4% actually did follow through to buy the new technology in short order. The analysts say they expect 5% of U.S. households to have 3D TVs by the end of 2011. Moreover, consumers are not shoing great concern over the dearth of 3D content available. They appear to be ready to make 3D a future-proofing part of their next TV purchase.

Magid says that attitudes toward Tv and other video viewing has remains relatively steady since the introduction of HDTV a decade ago. The additional video services like 3D, streaming media, Web video, TV apps, etc. are likely to added to our existing HD screens and not necessarily divert business from that core of subscription services.

4 comments about "Cord Cutting? Bah, Humbug! Magid Says Digital Video is Additive".
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  1. Bob Kiger from Videography Lab, November 29, 2010 at 2:52 p.m.

    Our recommended connection plan for minimal cost and maximum content is direct HD antenna connection to basic broadcasters. Couple this with an unlimited [5GB per month] data plan with a hotspot and you can get most anything while saving bandwidth for much live TV viewing.

    Saving bandwidth is a big deal says our www.vidiots.us affiliate in their latest article "T-Mobile data server down nationwide on Black Friday"

    Happy holidays and BTW AT&T network is a bit slow on this Cyber Monday.

  2. Joshua Chasin from comScore, November 29, 2010 at 3:31 p.m.

    Cord cutting isn't a myth. it's a forecast.

  3. Douglas Ferguson from College of Charleston, November 29, 2010 at 5:20 p.m.

    Another "long fuse" source of media havoc. Clearly cord-cutting is the future, but because the fuse is still burning, the old media tout how slowly it's burning rather than how inevitable their own demise is. I wonder how large the 20-something segment of Magid's sample is? Young people are the canary in the coal mine. When they get sick, the rest of us are not far behind.

  4. Carolyn Hansen from Hacker Group, November 29, 2010 at 6:30 p.m.

    I'm one of the 1% -- and I'm not young. We watch a lot of TV, but it's all on Hulu or bought from Amazon Unbox or iTunes, with a little Netflix streaming video thrown in. According to Wikipedia, Comcast has (or had) 23-plus million subscribers. According to a MediaPost news article on August 24, Comcast lost 679,000 video subscribers between Q1 and Q2 this year. Maybe the reason people are leaving cable isn't "because they are accessing content instead on the Internet" . . . but something is definitely going on.

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