Study: Most Cord-Cutters May Be OTA 'Opt-Ins'
Move could be more about migration to broadcast than online viewing, but jury is still out, says GfK researcher
By John Eggerton -- Broadcasting & Cable, 6/18/2012 3:01:26 PM
About 21 million homes rely on over-the-air TV, according to the latest data from GfK Media's (Knowledge Networks) Home Technology Monitor report.That is 17.8% of all TV homes, compared with a consistent 14%-15% over-the-air-only percentage for each year of the study since 2008, according to GfK.
Those broadcast-only homes continue to skew lower-income and
minority, but also younger households, the study found. And although
cord-cutting has been popularly tied to migration from pay TV to online video
viewing, GfK media researcher David Tice, in a blog about the data,
confesses up front to be a cord-cutter skeptic, at least to the argument that
the flight is from pay TV video to online video.
He says the research shows that over 70% of those who have
cancelled pay TV service said it was due to cost-cutting, with cord-cutting
because of online alternatives cited by less than 20%.
Tice is not saying that online video options are not an
important part of the equation, but said their data does not support suggesting
it is a primary driver of cord-cutting.
"So, if people without pay TV aren't necessarily flocking
online, what are they doing?" he asks. "With the completion of the
digital TV (DTV) transition, homes now have access to an enhanced digital
broadcast signal providing much better video and audio quality," Tice
blogged. "Another benefit of digital broadcasting is that homes also have
over-the-air access to numerous digital side channels, offering a variety of programming
in addition to the main broadcast channels."
That is an argument broadcasters have been making for
wanting to hold onto their channels in the face of government pressure to give
them up for auction.
"Obviously this demonstrates that, contrary to
conventional wisdom, over-the-air TV viewership is growing, not
declining," said National Association of Broadcasters spokesman Dennis
Wharton. "That shouldn't surprise anyone given the pay TV cord-cutting
phenomenon. This demonstrates that tomorrow's world will be both broadcasting
and broadband and that local TV stations have an exceedingly bright future."
NAB purchased the annual study, which GfK sells to a number
of clients, said Wharton, but it did not commission it. Tice confirmed that they supply the report to a number of clients.
Tice says the answer to why the cord is being cut may have
to wait until the economy picks up, if it does. "Then we'll see if people
maintain their broadcast-only status," he says. "That's when I'll
decide if I'm a convert to classifying homes as ‘cord-cutters,'" or, he adds, "maybe
some new term like ‘cost-cutters,' or even ‘OTA [Over-the-air TV] opt-ins.'"
The online study is of 3,200 households, with a margin of error of 1.5, plus or minus, with 95% confidence. Although the poll is online, it does not self-seclect for online-only households. Instead, it selects a cross-section of the population and those that do not have online service are given a computer and dial-up for purposes of taking the survey.
"We make sure the sample is representative of everyone in the country," said Tice.
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If a company wants you to buy their service, they will market to you endlessly. If you are a "base-level" customer, that company will market additional services to you.
People are not advertised to "to not buy things". So cord-cutting is a slow movement, and will always be a slow movement. People have to realize on their own that what they are paying for is not worth what they are paying.
If pay-tv subscriptions dip to under 75% of households, maybe the industry will change and start offering a la carte.
And, no, a la carte doesn't not suggest a flat fee where all the channel prices are equal, it means channels are priced in relation to their value.
FrankM - 6/20/2012 7:15:20 PM EDT -
yep, dial-up is representative of everyone in the country.
steve - 6/18/2012 7:27:12 PM EDT
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