Cord cutting’s effect on traditional cable companies


A study finds that U.S. households with paid streaming service surged 450 percent in less than a decade.

Deloitte's 12th annual digital media trends survey shows that streaming video adoption passed the halfway mark in 2017 with 55 percent of U.S. households now subscribing to paid services.

In 2009, it was just 10 percent.

Cable and satellite bundles are suffering the most. The survey found that pay TV has dropped to 63 percent in 2017.

Grounded Reason's Dennis Restauro follows Nielsen for consumer trends.

“Until the model changes with the way pay TV interacts with its customers, it’s just going to see this trend continue. They’ve been losing massive numbers in the millions, up to about 21 million over the past five years,” said Restauro.

He said we've been in a ramping up period as more people adopt cord cutting, it'll probably level off, but will continue.

Restauro added cable companies are "trying to figure out a way to stop the bleeding", by starting their own streaming services.

“The problem is they’re forcing people to get their internet, in order to use it, which kind of defeats the purpose. I think they’re looking at this as a way to hold on to customers,” said Restauro.

He said the problem people have with it is the hidden device fees.

The study showed that 16 percent to 22 percent of millennial and Generations X and Z consumers, have never subscribed to a pay TV service and are probably unlikely to do so in the future.

Deloitte's study found that Generation X has picked up the viewing habits of younger generations, such as watching more content on mobile devices. Typically, as generations grow older, they tend to revert to the consumption patterns of parents.


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