Characterizing it as a “development to watch,” Nielsen issued a new report to clients Wednesday showing that the number of U.S. households that bypass cable or satellite TV and subscribe only to broadband Internet access has grown dramatically in the past year, and not surprisingly, they spend dramatically more time watching TV over the Internet.
The Nielsen report said it is too soon to determine whether these households are so-called “cord-swappers” -– swapping the cable/satellite TV cord for the broadband Internet cord -– but they are growing faster than any other segment of the “cross-platform” television marketplace.
While the percentage of Internet-only TV homes is still relatively small -– less than 5% of all TV households -– they grew 22.8% over the past year, according to the report, which reflects data for the third quarter of 2011 vs. the third quarter of 2010.
Not surprisingly, these households are streaming more than twice as much TV online as the general population: an average of 11.2 minutes daily vs. 5.0 minutes for all TV households. While these households are relatively low users of TV -– at about half as much as the time spent watching TV by the general population –- they currently are watching more than 9% of all their TV minutes online. According to Nielsen’s data, the average TV household currently is watching about 1.9% of their total TV minutes online.
“The increase in broadcast-only/broadband homes is the most significant of any category, though it is not necessarily an indication of downgrading services,” reads the Nielsen report, which will be released to the media today. “Rather, this could reflect broadcast-only homes upgrading to broadband as their needs change. Further underscoring the importance placed on broadband Internet, the number of homes subscribing to cable-plus and no broadband decreased 17.1 percent since last year.”
Joe - paragraph four seems to contradict paragraph three. In P4, the data says that they (meaning cord-swappers?) are "watching more than 9% of all their TV minutes online". But by definition aren't these homes those without cable/satellite and only broadband/internet? I guess the other 91% of viewing time is over traditional broadcast?
Mark I was thinking the same thing, then I realized I know quite a few people who have reverted to the antenna signal for broadcast and use internet for some viewing... but the broadcast signal is often not dependable! It's kind of old-school to be adjusting a TV antenna...
@mark and @Cole -- Yes the balance (91%) of their TV minutes are views over the air. Sorry that wasn't clear.
The really interesting stat in the data is that people are watching more TV - viewing is up by 1 hour 17 minutes a month - and internet on PC is DOWN by 2 hours a month.
Sorry to pick on the data -- we know its not yours, Joe -- but this doesn't sit straight with me in a real world application.
"these households are streaming more than twice as much TV online as the general population: an average of 11.2 minutes daily vs. 5.0 minutes for all TV households."
Cord cutters are averaging 1/3 of a TV show and all households are averaging just 5 mins of streaming? That doesn't seem like watching much TV at all.
Are those results pulled down by the vast majority of people streaming no TV content? Any insight into the data would be helpful.
@DH, you are right, it's not our data, but my understanding is that those average monthly minutes spent are Nielsen's projections for all broadband-only households vs. all households. So yes, Nielsen is saying that the average broadband-only households streams 11.2 minutes per month and the average U.S. households streams 5.0 minutes per month. And I'd guess there is quite a range among those averages, with some households coming closer to your expectations.
@Manish, thanks for pointing that out.
Hey Joe, (love the summary) but there is a lot of talk about these cord-cutters. If I am reconciling Nielsen's household counts right, there is another group of about 4,489 (000) households without TV beyond there 114,126 (000) total. Are you aware of any source that might help me get at figuring out how many of those have broadband access. Since the switch from analog to digital TV, we cannot just assume those are low income households. Some portion have to be people electing not to receive any "TV", in favor of streaming all of their video online. (TVHH Universe of 114.7MM = 96.7% of all U.S. households.)
These are very funny numbers - not particularly to be trusted. But, let's accept them for a minute. First of all, the disconnected is such a TINY population that a 22% increase is pretty laughable. If there's a trend at this point, they need to be doubling and tripling. That's the truth of numbers and development - hence the title is an exaggeration. But, this "9% of their TV time is online" is shocking. Do I read this right that it means they're still watching 91% of their TV either from disc or over the air? Really? In that case, these are NOT cord cutters. They're likely forced into dropping TV for economic reasons like a friend of mine who disconnected their Dish because they don't have enough time to watch right now - but it'll be re-connected by the time of the Olympics so they can really watch them.