More Than One if Five Broadband Households Have No Pay-TV Service, Study Finds

You don’t have to look far these days for news on cord-cutting. According to a report out this week from Leichtman Research Group the largest U.S. pay-TV providers lost a combined 795,000 subscribers in 2016. According to a report out last week from TiVo the share of cord-cutters who have dropped service within the previous year reached 19.8 percent in the fourth quarter, the highest ever registered, suggesting the phenomenon is accelerating.

In yet another report released this week, The Diffusion Group turned the telescope around and looked not at how many pay-TV households have dropped their service but at the number of U.S. broadband households that are going without pay-TV service. If anything, the view was even worse for the pay-TV industry.

According to TDG’s survey, 22 percent of the 100 million households that subscribe to broadband — some 22 million homes — do not have pay-TV service. That’s up from 9 percent of the 85 million broadband subscribers in 2011, or 8 million households, and up from 18 percent just since the beginning of 2016.

“Wall Street and the media are myopically focused on the quarterly drip of legacy pay-TV subscribers, which unfortunately overlooks a larger and more dangerous trend,” TDG director of research and co-founder Michael Greeson said in a statement released with the report. “As TDG noted long ago, where broadband (and broadband video) goes, legacy pay-TV subscriptions will increasingly decline. This is indeed what has transpired.”

TDG calls those 22 million households “cord nils,” which encompasses both cord-cutters (17 million) and cord-nevers (5 million). And in the view of the TDG researchers, they’re not coming back. Just 8 percent said they are moderately or highly likely to sign up for pay-TV service in the next 6 months.

As with other studies, the biggest factor driving the cord-nils out of the traditional pay-TV fold is cost, cited by 68 percent of cord-cutters and 65 percent of nevers, although an equal 68 percent of cord-cutters also cited satisfaction with the streaming services that most of them subscribe to as a factor.

Overall, 83 percent of cord-nils subscribe to one or more streaming video service, led by Netflix, at 69 percent. Notably, though, the most widely used source of TV programming among the nils, cited by 66 percent, is DVDs and Blu-ray discs, followed by streaming and over-the-air channels, at 58 percent each. The survey didn’t ask, or at least TDG didn’t report, how many cord-nil households engage in unauthorized streaming of pay-TV content, although it’s probably not zero.

 

What both reliance on DVDs and Blu-ray discs and streaming services offer cord-nil households is a measure of control — the ability to calibrate what you pay with what you’re actually watching, something the traditional pay-TV bundle was designed specifically to deny to users. How much longer the pay-TV providers can continue to deny users that control before the incoming tide of cord-nils becomes a flood is the most important question confronting the industry.

Verizon Will Offer Skinny Bundle Video In 5G Wireless Test, CEO Says 

Verizon plans to offer a skinny bundle video service via 5G wireless transmissions in early 2017 to test the speedy technology in some “relatively small towns,” CEO Lowell McAdam said today at the UBS Global Media and Telecommunications Conference.

Source: Verizon Will Offer Skinny Bundle Video In 5G Wireless Test, CEO Says | Deadline

It took a couple decades, but the music business looks like it’s okay again

Music sales in the first half of the year were up 8.4 percent, to $3.4 billion — the industry’s best performance since the height of the CD era. That boom is fueled entirely by the growth of paid subscription services. This year’s numbers include Apple Music, which didn’t exist a year ago but has 17 million worldwide subscribers today, as well as Spotify, which has been growing faster than Apple and has 40 million global subs.

Source: It took a couple decades, but the music business looks like it’s okay again – Recode

Apple Music Buys ‘Carpool Karaoke’ TV Series 

Apple has emerged as the surprise buyer of the unscripted TV series based on the “Carpol Karaoke” segment of CBS’ “The Late Late Show with James Corden .” The tech giant’s Apple Music service will distribute the series to its members in 100 countries worldwide. Apple sees the show as a natural vehicle to drive online activity for its streaming-music venture.

Source: Apple Music Buys ‘Carpool Karaoke’ TV Series | Variety

The upside of Facebook’s unprecedented power

Facebook provides content owners the ability to reach over 1 billion users who each spend 50 minutes on average on the platform every single day. As a point of reference, daily newspaper circulation peaked in the U.S. at about 60 million households and today, cable television reaches approximately 100 million households. Bottom line: An unprecedented global distribution opportunity.

Source: The upside of Facebook’s unprecedented power – Recode

Streaming-music listeners really don’t care about missing out on CD-like sound quality

Streaming-music listeners really don’t care about sound quality.

A recent survey by MusicWatch found that few music fans would pay more to listen to music with better audio quality. The consumer research firm, which polled 7,700 people, asked listeners who stream music for free what it would take for them to pay for a service. Just 6% said that CD-like sound quality could persuade them to part with their hard-earned dollars.

Streaming-music listeners really don’t care about missing out on CD-like sound quality

Netflix’s Global Growth Faces New Threats

When Netflix Inc. won rights to premiere gothic TV drama “Penny Dreadful” in several European countries, local media companies that lost out were miffed. They were growing increasingly frustrated that the streaming juggernaut is scooping up exclusive rights to top shows as it pursues an aggressive global expansion, locking them out in their home markets. It was time to mount a response.

Source: Netflix’s Global Growth Faces New Threats – WSJ

Net-Neutrality Proponents Warn of Loopholes 

T-Mobile customers who want to watch the hot new Netflix show “Master of None” or the old HBO favorite “Game of Thrones” can do so without counting it against their data caps, if they use the wireless carrier’s popular new Binge On service.Good news for consumers, maybe, but it is worrying some consumer advocates, who say the service could be the beginning of attempts to circumvent the government’s net-neutrality rules before they have even taken root.

Source: Net-Neutrality Proponents Warn of Loopholes – WSJ

Survey Says: 70 Percent Don’t Use TV Apps

Nearly nine out of 10 U.S. pay TV subscribers—86 percent—want a single app for all of their video watching, according to data from Altman Vilandrie & Co.’s sixth annual survey on consumer video habits. The survey also revealed that 70 percent of consumers have not downloaded any network or cable channel apps, even as they continue to be inundated with more streaming video options.

Source: Survey Says: 70 Percent Don’t Use TV Apps | TvTechnology