Conventional wisdom would have it that consumers who stream video are more likely to cancel theirÂ pay-TV services. But a couple of new reports offer mixed signals about the link between streaming and cord-cutting. On the one hand, data from Centris Marketing Science suggests that pay-TV households who stream TV series are actually less likely to cancel their pay-TV subscriptions than those who don’t stream. On the other hand, a report from Experian Marketing Services [download page] finds that households with Netflix or Hulu accounts are more likely than average to have cut the cord.
Acccording to the Experian report, some 18.1% of US households with Netflix or Hulu accounts were cord-cutters last year, a rate almost three times the 6.5% national average. That rate appears high, considering that pay-TV providers lost only 0.1% share of their subscribers last year. However, the Experian definition of a cord-cutter includes so-called cord-nevers; individuals who have never had pay-TV service. That’s because Experian refers to cord-cutters as households with high speed internet but no cable or satellite TV service.
How prevalent are cord-nevers? Centris research suggests that about 1 in 8 households in the 18-34 bracket have never paid for TV service. Not surprisingly, the Experian data finds that the percentage of households that are cord-cutters (their definition) is almost twice as high for households with 18-34-year-olds present than for all households on average (12.4% vs. 6.5%).
While the Experian data suggests a strong link between streaming behavior and cord-cutting, the survey from Centris is less conclusive. Though it was fielded among just a small sample (297 US households), the survey found one-quarter of those who stream TV series to be at least somewhat likely to cut the cord over the next 12 months, compared to one-third of those who do not stream TV series. That’s an important result for pay-TV providers, given that 56% of subscribers claimed to stream TV series of the internet at least once a month.
The Centris findings lend themselves more to the concept that online video serves as a complement, rather than a replacement, for pay-TV.
Meanwhile, Experian also draws a link between mobile device ownership and cord-cutting. According to their results, households where at least one resident owns a smartphone are 20% more likely to be cord-cutters, and those where someone owns a tablet are 36% more likely. Those figures bump up to 33% and 65%, respectively, for iPhones and iPads.
As expected, adults who use their digital devices primarily to watch streaming video are more likely to be cord-cutters than those who simply watch videos on those devices. That’s particularly the case for those who use their TV primarily for streaming video; these consumers are almost 6 times more likely than average to be cord-cutters.
For the time being, only a minority of connected device owners use their devices primarily to watch streaming video, as the following rates attest:
- Smartphones: 4%;
- Work PC: 9%;
- Home PC: 18%;
- Tablet: 22%;
- TV: 32%; and
- Game console: 49%.
The Centris research indicates that consumers don’t have a preferred way of streaming TV shows. Some 35% watch an entire season of one show before moving on, while 33% stream multiple series at once and the remaining 32% watch only their favorite or missed episodes.
And in an intriguing twist, a VentureBeat report based on data provided by Comcast finds that on-demand binge viewing of TV series may actually boost shows’ live TV premieres.