People are increasingly tuning into streaming services to keep themselves occupied while sheltering at home. Some of them might never return to cable. A survey conducted by The Trade Desk and YouGov suggests that coronavirus lockdowns could be accelerating cord-cutting in the United States.
The survey, that was carried out earlier this month on more than 2600 adults, found that 64% of U.S. households with at least one screen have either cut the cord with cable TV, never subscribed, or are planning to cancel subscriptions soon. As expected, the results were in favor of video-streaming platforms especially among millennials where that figure rose to 74%.
Of those households that still pay for cable, 11% will likely switch exclusively to online channels by the end of the year — remarkably higher than the 3% prediction eMarketer made last year.
“With only a quarter of young adults having any long-term interest in traditional cable TV, in a few years, we won’t be talking about linear or cable TV at all. It will all be online and streaming. For broadcasters and advertisers, it’s now all about how quickly they can pivot to where the eyeballs are moving and many of them are already investing heavily in order to succeed in a world of connected TV,” said The Trade Desk’s Chief Strategy Officer, Brian Stempeck.
The report adds that the shift is primarily driven by the worldwide suspension of live sports which is one of the major factors for why many (60%, in the United States) still have a cable TV subscription.
Cost, however, is a key hurdle that platforms like Netflix will have to figure out to overcome cable. Cord cutters today are forced to subscribe to multiple streaming sites to watch their favorite channels, unlike cable where they pay a fixed monthly fee for a bundle. About 35% of the households polled said they would prefer a free streaming service with advertising or some ads for a more affordable subscription. While incumbents such as Netflix have continued to steer clear of ads, newer platforms such as NBC’s Peacock have announced cheaper, ad-supported plans.
In the past few weeks, as more regions go under lockdown, streaming traffic has soared to record highs — so much so that platforms had to temporarily throttle their streaming quality. Without live sports and limited new entertainment content, it makes sense that cable TV is struggling to keep up with streaming services that offer a treasure trove of on-demand movies and shows. It remains to be seen, however, whether streaming platforms are able to retain these figures post-coronavirus as well.
