But Who Are They and Where Are They Going?

For decades, cable and satellite providers have battled in a virtual duopoly of consumer choice. But recently, the behemoth television utilities are united by a common threat – the Cord-Cutter. As more and more consumers -particularly younger people – are turning their eyeballs toward streaming content, the empires of companies like Comcast, DirecTV, and their peers face a growing risk.  But how great is the risk? And whose risk is the greatest?

Over the past several months, we analyzed poll results from over 23,434 U.S. consumers, including 21,433 cable and satellite subscribers, to see how many of them are looking to switch providers and to where. We also took a quick glance at the profile of the likely Cord-Cutters to see if traditional providers could do anything to stop it. Here are the top-line results:

Cable and Satellite Cord-cutter Results

Overall, one might conclude that cord-cutting or provider-switching, in general, won’t be a huge problem in the near-term. When you take out the people who don’t have any TV service, an even 90% of cable or satellite subscribers have no designs on changing anytime soon.

Still, satellite providers should have some concern. 1% of the respondents we surveyed said that they are planning to switch from satellite to cable, while another 1% indicated they may switch from satellite to streaming-only. It looks, however, like they could overcome those numbers by picking up the 3% of consumers who say that they plan to switch from cable to satellite.

And cable? Well, that’s even worse. Already facing a well-documented erosion in subscribers, cable companies may not see their bleeding stop anytime soon. According to our figures, 3% of U.S. consumers could leave cable in favor of satellite, while another 3% may move from cable to streaming-only. Both numbers represent a 300% increase over their satellite-peddling brethren.  Roughly speaking, at 6% of the 114 Million households in the U.S., this could mean that as many 6.84 Million cable subscribers are at risk. It’s important to note that the disparity between the cable and satellite numbers can be partially explained by the fact that cable subscribers outnumber satellite subscribers in the US. Exact numbers are hard to find but most estimates suggest that cable outnumbers satellite by a little less than 2 to 1. So, even with that, the 3 to 1 intended switching rate we see above is still disproportional.

So, who are these likely switchers? Looking first at the cable-to-satellite switchers, we found that the most vulnerable group was those aged 45-54. They also tended to be at the lower end of the income spectrum, averaging $26k-$50k in annual take-home.

Likely cable-to-streaming switchers, meanwhile, were a bit younger, between 35 and 44. The greatest flight risk to cable companies is among consumers aged 35-44 living in the US Northeast, where 5.1% said they are planning to switch from cable to streaming-only. Interestingly, 4.1% of respondents aged 18-24 in the US Midwest are planning to switch from cable to streaming, by far the highest rate we found among this youngest respondent segment.

And a few thought-provoking correlations showed up in our analysis as well.

–          People who watch MSNBC for the majority of their cable news were 80% more likely than average to say they’re switching from cable to satellite. Could this have anything to do with Comcast’s (which owns NBC) deal to buy TimeWarner?

–          For what it’s worth, you might find different results if you tried to replicate our research using traditional phone polling. People who are planning to switch from cable to online streaming are 38% more likely to NOT have a land line telephone.

–          When asked which topic or hobby they are most passionate about, cable-to-satellite switchers are 36% more likely than average to say “Sports.” Maybe they want that NFL package they can only get through satellite service.

–          But when we asked cable-to-streaming switchers which topic they are most passionate about, they were 61% more likely than average to say “Health & Wellness.” Maybe they just want to get away from the television, in general, and hit the outdoors.

Online streaming, as an alternative to cable or satellite TV service, is not going away. And what’s perhaps most interesting in the above data is that the highest rate of potential cable-to-streaming turnover is among people aged 35-44, NOT the younger consumers that already dominate the streaming landscape.  But, perhaps with the right insight into the potentially vulnerable switchers, the traditional TV providers can stem the tide. With technology, business models, and the overall industry landscape changing almost by the day, it should be pretty exciting to watch.