A record number of consumers are ditching their cable and satellite TV subscriptions as the COVID-19 pandemic accelerates the cable cut trend of the last decade.
About 6.6 million households are expected to cut the wire this year, according to research firm eMarketer. That leaves just $ 77.6 million still paying, a 7.5% drop, the steepest drop in a year, eMarketer said. Since the peak of pay TV subscriptions in 2014, 23% of households have cut the cable.
A year ago, the firm predicted that half of households would cut the cord in 2020. But the pandemic has accelerated the trend for several reasons. Tens of millions of people have lost their jobs, limiting their finances. Live sports, one of the biggest remaining attractions on pay TV, was also forced off the air for months, but cable companies did not cut their sports rates. And finally, the market for cheaper streaming alternatives continues to grow, led by Netflix, but now also with input from Comcast’s Apple, Disney, and NBCUniversal.
“Consumers are choosing to cut the cable due to high prices, especially compared to transmission alternatives,” eMarketer analyst Eric Haggstrom said in the report. “The loss of live sports in [the first half of] 2020 contributed to further declines. While sports are back, people won’t go back to their old cable or satellite plans. “
The cable cut will continue to cut subscribers to large pay TV providers such as Comcast, Charter Communications and AT & T’s DirecTV for the foreseeable future, eMartketer added. By 2024, another 15.4 million households will cut the cable and more than a third of all households will be disconnected from pay TV.
The trend has been to punish television advertising, which will drop to $ 60 billion this year, down 15% from 2019 and the lowest total since 2011, eMarketer said.
However, cable service disruption has not had such a strong impact on cable TV providers, because most are also among the top providers of residential broadband Internet services. Comcast, for example, lost 671,000 cable TV subscribers last year, but added 1.3 million Internet subscribers. And while its cable revenue fell 1% to $ 22.3 billion, its Internet revenue increased 9% to $ 18.8 billion.
