telecom

Consumers Want More Flexibility From Cable Companies

by Aaron Baar , December 11, 2014

Tired of the legacy models, consumers are beginning to ask their cable companies for more options, and are looking for more over-the-top, Internet-only solutions.

According to a study from mobile ad tech company Marchex, 26% of new cable customers are asking for Internet-only service, compared with 22% asking for television-only services. Furthermore, 40% of consumers are asking if they can pay only for specific channels.

“That’s an indication that consumers want a gateway to the content,” Chen Zhao, director of analytics for the Marchex Institute, the data and insights team at Marchex, tells Marketing Daily. “Consumers clearly want more flexibility and choice.”

Through its Call Analytics platform, Marchex evaluated 500 random calls out of the 1.1 million placed to cable providers in 2014. “The information that [comes through] these calls is super important,” Zhao says, noting that the are the main sales and communication channels for most providers.

Consumers are also becoming contract-averse when it comes to cable subscriptions. While discounts or additional features worked to incentivize new customers, a provider's insistence on locking customers into three-year contracts worked against them.

Still, the study found that nearly half of consumers placed a priority on premium programming, such as HBO or Showtime, and sports remained popular enough to prevent many consumers from cutting the cord entirely.

“We believe cable companies should be adapting to consumers' tastes,” Zhao says. “They should definitely be testing ideas. There’s no reason to be shoving those extra channels down people’s throats.”

Among the ideas they could be testing: more flexible channel packaging and shorter-term contracts. Meanwhile, networks and other content providers may want to begin looking at ways to increase consumer demand across a variety of platforms. All those tactics are important if the cable companies want to attract Millennial consumers, many of whom aren’t seeing the value of subscription television, Zhao says.

“They need to attract [millennials] in the first place,” she says. “Millennials couldn’t care less about what the cable companies are offering right now.”

"Cord Cutting" photo from Shutterstock.

cable, cable tv, ott, research, telecom, tv

4 comments about "Consumers Want More Flexibility From Cable Companies".

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Don Scott from BH Media Group, Inc., December 11, 2014 at 4:34 p.m.
This is no surprise! At this point cable has the upper hand, but consumer pressure will buckle the existing business models of the operators. When? It's hard to say, but the pressure is on.
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Jim O'neal from Independant Media Consultant, December 12, 2014 at 10:35 a.m.

My 26 year old has never had a cable connect...only internet and cell phone, and likely won't ever have a traditional plan...at 175 dollars for a "triple play" out of promo period, I wish I had other
options too, stuck with only one provider here...

Alan Westendal from West End Communications/Consul, December 12, 2014 at 4:29 p.m.

There was a time when the idea that FM radio would surpass AM seemed incredible; that cable would overtake over-the-air TV, ditto. Non-wired will surely surpass wired one of these days, too. It may even occur that some new system will not even need electricity, as the inapt cut-the-cord visual analogy in this article implies.

Scott Gilbert from The Radio Mall, December 13, 2014 at 11:38 a.m.

No, Jim O'Neal, you are not stuck, unless you live way out in Rural America. Cancel your provider and get an antenna and a computer (which makes an excellent DVR) or other streaming device and go to town!