Mass Cord Cutting Is A Myth Say Nielsen

It looks like stories of mass cord cutting has been premature. Viewers are it seems, not replacing their cable and TV subscription services with internet TV services says a new report from Nielsen. The report “busts the myth” that viewers are taking their viewing time online and cutting the cord.

Even more surprising, their research shows that the opposite is happening, and subscriptions to cable and broadband have grown substantially during the past two years. Around two-thirds of all US households had both pay-TV and broadband subscriptions as of January, says the report, a rise from 61.6% in 2009 and 54.8% in 2008 as subscribers signed up for broadband.

The number of households that has gone broadband-only increased just slightly over the same two-year period, to 3.9% from 3.2% in 2008, and remained essentially flat over the past 12 months.

When it comes to watching tv online, the numbers are growing but at a slower rate than expected. Nielsen reports that it grew by 6% year on year, and the time spent watching internet video rose 9%, it’s still a relatively small market compared to traditional TV. According to the research and measurement firm, only 2.5% of tv viewing happens on the internet.

It is the younger generation that are driving online tv says Howard Shimmel, SVP of client insights for Nielsen, the shift to online video viewing only is happening in “small packets of the population” that “reflect a younger population of college graduates and lower to middle income consumers who may not be fully convinced of the need to pay for digital cable.” But those viewers also watch 40% less TV than the national average, and while they typically stream twice as much online video as the average US consumer, they’re still only watching about 10 minutes daily of online tv.

Whilst the cable industry isn’t seeing a mass exodus from its pay-TV subscriptions yet, it should take heed of what happened in the phone market over the last ten years, which started as a younger generation fad that quickly grew into the mainstream. Of course the cable companies are aware of the threat, which is why they all have an online presence right now.


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