Survey: U.S. Cord Cutting Rising as Consumers Look for More Flexibility

SEATTLE: More U.S. consumers than ever are choosing to “cut the cord” and stream their content online, citing frustrations with rising cable bills and TV bundles that include dozens of unwanted channels, according to an industry trend report from Marchex. 

To understand at scale what kinds of TV services Americans are willing to pay for, Marchex used its Call Analytics platform, which has processed anonymous data from 1.1 million consumer phone calls placed to leading cable providers in 2014 across the U.S. Marchex’s technology further analyzed a subset of 500 randomly selected phone calls and found that Americans are increasingly looking to “shave” or “cut the cord” with cable providers in order to stream their favorite shows over the Internet.

Nearly 26 percent of new customers asked for Internet service only, as opposed to 22 percent who asked for only cable. This suggests that more consumers are interested in an a la carte pay-TV model, in which the Internet provides the gateway to content and channels without costly bundling. Nearly 40 percent of consumers asked providers about paying for specific channels, which strongly suggests that consumers want more freedom and flexibility to cherry-pick content. Of those consumers, nearly half, 47 percent, wanted premium programming, such as Showtime, Starz or HBO. The top premium channel requested was HBO.

The category of sports is critical, and ESPN leads the way. Sports matches remain a huge ratings draw, leaving fans largely unable to cut the cord. Five times as many consumers in the study asked for ESPN compared to those asking for Fox Sports (20 percent vs. 4 percent).

“Cable companies are coming face-to-face with the threat of disruption. Our data shows that providers need to start addressing pressing consumer demands; otherwise, they risk losing real market share when people decide to cut the cord for good,” said Chen Zhao, the director of analytics for the Marchex Institute, the data and insights team at Marchex.