USA: Cord Cutting on the Rise

written by: Richard Kastelein

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cordcutting2In 2013, roughly around 22 million homes rely only on over-the-air broadcast rather than pay TV service, according to new research from GfK Media & Entertainment. And that's close to 6 million more people relying on over-the-air broadcast television than a year ago. How many are cutting the cord or cutting the cost is the question..

David Tice from GFK writes:

As we saw last year, broadcast-only levels are even higher among minority and lower-income homes, as well as with younger householders; these groups have all have seen higher-than-average increases in broadcast-only reception in recent years.

The percentage of TV households currently OTA reliant has grown from 14 per cent in 2010 to 19.3 per cent in the current survey — a 38 per cent increase in about four years, according to the study that was released this week to NAB members.

Andrew Dodson from TV News Check continues:

The survey doesn’t account for over-the-top services, like Netflix and Hulu Plus, which cost about $8 per month per service, plus the cost of a set-top box like a Roku or Apple TV. Cord-cutters supplement OTA television with those on-demand services.

The survey found that demographics of broadcast-only households continue to skew toward younger adults, minorities and lower-income families. Other statistics include:

  • 19.3% of all U.S. households with TVs rely solely on OTA signals — up from 17.8% from last year.
  • GfK estimates 22.4 million households representing 59.7 million consumers receive television exclusively through broadcast signals and aren’t subscribing to a Pay TV cable or satellite service.
  • Nearly 6% of TV households cut the cord in their current home at some point in the past, doing so to cut monthly costs from budgets and citing there isn’t enough value for the cost. Those responses were also the top answers in the 2012 survey.
  • Minorities make up 41% of broadcast-only homes.
  • 49% of Latino households that prefer speaking Spanish home have a Pay TV service — down from 67% in 2010.
  • 28% of TV households where the head of the house is 18-34 in age, exclusively watch TV via broadcast signals, up from 18% in 2010.
  • 19% of TV households where the head of the household is 35-49 relies on OTA signals; 17% in which the head of household is 50 years or older.
  • Two out of 10 younger OTA households have never purchased a pay TV service.
  • 30% of TV homes with an annual income less than $30,000 rely solely on OTA TV — up from 22% in 2010.
  • 11% of TV households with incomes of $75,000 or greater rely solely on OTA TV.

 

About the Author

Richard Kastelein
Founder of The Hackfest, publisher of TV App Market and global expert on Media & TV innovation, Kastelein is an award winning publisher and futurist. He has guest lectured at MIT Media Lab, University of Cologne, sat on media convergence panel at 2nd EU Digital Assembly in Brussels, and worked with broadcasters such as the BBC, NPO, RTL (DE and NL), Eurosport, NBCU, C4, ITV, Seven Network and others on media convergence strategy - Social TV, OTT, DLNA and 2nd Screen etc.

He is a Fellow of the UK Royal Society of Arts (RSA) and UK Royal Television Society (RTS) member.

Kastelein has spoken (& speaking) on the future of media & TV in Amsterdam, Belfast, Berlin, Brussels, Brighton, Copenhagen, Cannes, Cologne, Curacao, Frankfurt, Hollywood, Hilversum, Geneva, Groningen (TEDx), Kuala Lumpur, London, Las Vegas, Leipzig, Madrid, Melbourne, NYC, Rio, Sheffield, San Francisco, San Jose, Sydney, Tallinn, Vienna, Zurich...

He's been on advisory boards of TEDx Istanbul, SMWF UK, Apps World, and judged & AIB awards, Social TV Awards Hollywood, TV Connect & IPTV Awards.

A versatilist & autodidact, his leadership ability, divergent and synthetic thinking skills evolved from sailing the world 24000 miles+ offshore in his 20′s on sailboats under 12m.

He spent 10 years in the Caribbean media & boating industry as a professional sailor before returning to Europe, to Holland.

A Creative Technologist and Canadian (Dutch/Irish/English/Metis) his career began in the Canadian Native Press and is now a columnist for The Association for International Broadcasting and writes for Wired, The Guardian & Virgin. His writings have been translated into Polish, German and French. 

One of Kastelein's TV formats was optioned by Sony Pictures Television in 2012. 

Currently involved in a number of startups including publishing TV App Market online, The Hackfest and Tripsearch TV. As CSO for Worldticketshop he helped build a $100m company.

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