Survey Says: Netflix Turns TV Viewers Into Cord Cutters

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Almost every other user of Netflix’s online video offering is considering canceling his pay TV service, according to a new J.P. Morgan Consumer survey, MediaMemo reports. Netflix has long said that it doesn’t see itself as a replacement for cable television, but it’s becoming increasingly clear that its customers beg to differ: J.P. Morgan research found that 47 percent of all active users of Netflix’s streaming service (people who stream at least one to two videos per month) would consider to drop pay TV or have already done so.

Even Netflix customers that don’t make use of the company’s online offering seem to be tempted by the fact that they could always access it as a replacement for pay TV. 42 percent of these DVD-only customers said they’d be open to consider going cable-free. All in all, 28 percent of all cable or satellite TV subscribers said they’d consider to switch from pay TV to broadband video.

That’s in itself a huge number — in fact, J.P Morgan Analyst Imran Khan calls it “consumer-driven Tsunami.” However, the fact that Netflix usage has such a strong impact on this sentiment should clearly worry pay TV providers. These are not consumers that cancel cable out of economic necessity or because they don’t have another choice. These are consumers that have tried an alternative, and liked it enough to consider cutting the cord.

Of course, not all of these consumers will follow through with the idea. The absence of sports content and the presence of really tempting retention deals you get offered when you call to cancel your cable service will likely help to keep the majority of customers on board for the time being. But with Netflix making inroads with TV content deals, it’s only a question of time before a significant amount of its customers actually follow through.

Adding to this is the temptation of connected devices. Roku CEO Anthony Wood told us last year that every fifth Roku user has already cut the cord. Netflix is now available on more than 200 devices, and the company has been actively advertising the combination of such devices and its online service as a way to get movie and TV shows onto the TV screen. It recently launched a new ad campaign with TV commercials that exclusively focus on the $8 a month streaming plan and don’t mention DVDs at all. And where are those ads running? You guessed it: On cable.

Check out the most recent episode of our weekly web series Cord Cutters below:


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