DALLAS: Less than 8 percent of U.S. broadband homes—about 5.5 million homes—are considering canceling their pay-TV subscriptions in favor of online video, a Parks Associates report indicates.
The report, All Eyes on Video, notes that the unlikelihood of subscriber churn this year is in line with previous studies, despite the proliferation of available content online. A 2008 study reported 11 percent of U.S. broadband households were considering canceling pay-TV services, and in a 2009 survey the number was 10 percent.
While 5.5 million homes would be open to canceling pay TV due in part to the availability of online video, about 50 percent of these households are also considering a switch to a new pay-TV provider. The households likely to switch or cancel their services are high consumers of online video, watching ten hours per week. They are also interested in TV Everywhere services that can provide online access to pay-TV channels.
“The threat of cannibalization is real but misunderstood,” said John Barrett, the director of research at Parks Associates. “Nobody is going to rely on online video alone—households likely to cancel their TV services are going to use a mixture of online video, free-to-air broadcasts, and DVDs, including rental services such as Netflix and redbox.”