Commentary

No Cord-Cutting Please, We're British

Cord-cutting is huge news in many parts of the world. With the likes of Netflix, Hulu and Amazon Prime pumping high-quality content to screen over the Internet and all the major broadcasters offering catch-up services to streamers, it's easy to see why. Many people could pull the cord out of the back of the tv set, or the satellite or cable box, and just stream away to their heart's content. 

You would think the UK could potentially be at the forefront of this. Netflix and Amazon are there for all, as are the catch-up apps such as All4, ITV Player and the BBC's iPlayer. However, assumptions can be dangerous, and serve as a reminder to check the data. When you do, you see that Brits are half as likely as the global average to be considering cord-cutting. This morning's figures from Nielsen suggest that only 15% of British households would consider cutting their cord compared to 32% globally. So that's the equivalent of roughly one in seven Brits versus one in three people globally. 

With one in five Brits watching video-on-demand services provided online, we are slightly below the global average there -- and so it isn't a huge surprise that for those who stream video-on-demand content, only one in three do so every day, compared to a global average nearing one in two. Also, Brits watch tv shows on video demand more than they do movies, in Europe -- and globally the opposite is true.

So those are the stats -- what does it all mean? Well, it's very good news for pay tv providers such as Sky and cable operator Virgin. Britons are not likely to want to switch off their services any time soon. It also serves a warning to Netflix and Amazon that the British market is different from the rest of the world, and that is going to impact the top ceiling on the subscriptions they can expect to reach. 

There's a very good reason why my wife and I are typical, using Netflix and hardly ever Amazon to watch shows rather than movies. In a word, the reason is Sky. It is way out ahead as the best service for movies and sports. OK -- so we now have to pay BT for some European football, but of course we keep our Sky subscription, which also offers the latest movies. In short, Netflix and Amazon simply cannot compete on movies; they're nowhere near. For the latest blockbuster or the must-see game, it's always going to be Sky every time. What Netflix can do, of course, is keep us hooked to the likes of "House Of Cards," but that will never be enough to cord-cut. It's an extra expense, not something we would do instead.

In the UK, cutting the cord would mean losing Sky, whether it's access through a satellite or cable package -- and that's where overwhelmingly all the great content is, particularly for movies and sports. 

So the rest of the world is likely to carry on talking about cord-cutting, and it will be a small issue here. Ultimately, however, so long as the good stuff is provided by that cord, little will change in the UK.

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