Despite the pay-TV industry's hopes that cord cutting is a myth, the reality appears to be that it's moving along at a pace several analysts have forecast, with some 7 percent dropping pay-TV and 12 percent shaving their services. And that's the good news.
The bad? One-in-five consumers with a household income of $50,000 or less expect to cancel even their basic cable service in the next year. Only 3 percent of wealthier households, those with income of $100,00 and up, cut their cable package, said the latest study, from Wedbush Securities analyst James Dix. Dix said that, even as the economy slowly pushes toward an apparent recovery, cost-cutting consumers still see their pay-TV service as a luxury they can afford to trim aggressively, or eliminate.
At the same time, Dix said, they're holding on to their Internet connections--only 2 percent have cut that cord. Dix says he sees that as proof they're turning to over the top delivery options for their entertainment.
"There is evidence of cord cutting," he said.
The Wedbush survey of 2,500 consumers is just the latest in a string of cord-cutting predictions that have the industry jumping, especially as the cable industry in Q2 saw its worst subscriber losses in history; some 711,000 cable customer dropped their subscriptions. And, even though a large portion of those move to AT&T's U-verse IPTV service and Verizon's FiOS service, the industry as a whole saw a subscriber drop in Q2.
- see this N.Y. Post article
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