Thursday, September 11, 2014, 6:14 PM ET|Posted by Will Richmond
Interest in cord-cutting remains relatively muted according to new data from Frank N. Magid Associates. The firm, which has been surveying consumers' attitudes towards cord-cutting each of the past 4 years, found 2.9% of respondents agreeing they're "very likely" to cancel their pay-TV service in the year ahead, a slight uptick from 2.7% found in 2013, 2.2% in 2012 and 1.9% in 2011.
Magid noted that the "very likely" level jumped to 4.9% for 25-34 year-olds, but dropped to 1.4% for those identifying themselves as ESPN viewers (live sports are widely believed to be the most formidable bulwark against cord-cutting).
In reality however, there's a huge difference between consumers' surveyed intentions and their actual behaviors. For example, in 2013, according to Leichtman Research Group, pay-TV operators representing about 94% of the overall U.S. market lost about 105K subscribers, or just .1% of the 94.7 million subscribers they had at the end of 2012. That's obviously way lower than the 2.2% of Magid's 2012 survey respondents who said they were "very likely" to cut the cord.
In 2014, the gap between intentions and actual behaviors may widen even further. According to LRG, in the first 2 quarters of 2014, these same operators actually gained almost 100K subscribers, compared with the 900K they had lost in the first 2 quarters of 2013. So even though consumers' cord-cutting intentions are up in Magid's 2014 survey, pay-TV operators may actually add subscribers in 2014.
None of this is to minimize the over-hanging threat to pay-TV posed by new OTT options. But it is important to remember that for now anyway, cord-cutting intentions are still relatively low, and actual cord-cutting is even lower still. What may be more interesting to follow are cord-nevering intentions, particularly among younger audiences. This may well be the bigger long-term industry threat as OTT options proliferate.
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