As more TV viewers watch their favorite shows online, the number of U.S. households without a cable subscription is expected to rise dramatically between now and 2016, according to a new report from Magnaglobal, a media forecasting firm.
By 2016, the number of households that do not subscribe to a traditional pay TV service will triple from what it is today. All told, 9 million households won’t have cable, Magnaglobal predicts. Of those, about 4 million are what we’d call cord cutters; people who once subscribed to cable but canceled it in favor of accessing television content via the Internet using a set top box or computer hooked up to their TV sets.
Comprising an even bigger number of cable-free consumers will be those who never signed up for cable or satellite service in the first place. This group of consumers is growing. Teenagers live more and more of their lives online, where they consume most of their media, even if their parents are paying for cable subscription at home. As that generation goes away to college, there’s little reason for many of them to pay up for cable TV on campus when Hulu, Netflix and a variety of competiting services await them. Once they graduate and enter the job market, cable is just not something they are likely to feel they need.
The number of people who never signed up for cable is expected to double – to 5 million, from 2.5 million today – by 2016, according to the report. Meanwhile, growth of DVR ownership is expected to slow down, as the devices become less necessary in light of stream-anytime Web content sitting waiting in people’s video queues.
The cable industry, having seen this coming, is preparing its own preemptive strikes. Comcast and Verizon are rumored to be bringing cable subcriptions to Microsoft’s XBox 360, a gaming console that effectively doubles as a set-top box. Comcast has rolled out its own Web TV initiative called “TV Anywhere” that lets paying subscribers watch content from a variety of devices. They also bought a giant content company, just in case.
Photo by Windell Oskay
