U.S. consumers are canceling their traditional pay-television services at a much faster rate than previously thought, Variety reports, citing data from the research firm eMarketer.
“In 2017, a total of 22.2 million U.S. adults will have cut the cord on cable, satellite or telco TV service to date — up 33% from 16.7 million in 2016 — the researcher now predicts,” Variety reports. “That’s significantly higher than eMarketer’s prior estimate of 15.4 million cord-cutters as of the end of this year. Meanwhile, the number of ‘cord-nevers’ (consumers who have never subscribed to pay TV) will rise 5.8% this year, to 34.4 million.”
The report quotes Chris Bendtsen, senior forecasting analyst at eMarketer, saying: “Younger audiences continue to switch to either exclusively watching [over-the-top] video or watching them in combination with free-TV options. Last year, even the Olympics and [the U.S.] presidential election could not prevent younger audiences from abandoning pay TV.”
Variety adds: “Overall, 196.3 million U.S. adults will have traditional pay TV (cable, satellite or telco) this year, down 2.4% compared with 2016, eMarketer predicts. By 2021, that will drop to 181.7 million, a decline of nearly 10% from 2016. The number of pay-TV viewers 55 and older will continue to rise over the next four years, while for every other age cohort the subscriber tallies will decline.”
As a caveat, the report notes that eMarketer’s estimates of pay-TV viewers do not include “virtual” Internet TV services, such as Sling TV, DirecTV Now and Hulu’s live TV service.
“But industry analysts say over-the-top TV subscription services so far have not offset declines in traditional pay television,” Variety notes. “Moreover, the cheaper OTT packages typically include fewer channels, so the growth of ‘skinny’ TV bundles implies net household losses for many cable networks.”