New research suggests that people who have cut the cord aren’t doing so because they think Netflix provides a good alternative to their local cable TV company. In fact, those that go broadband-only are only slightly more likely to watch online video than those with pay-TV subscriptions, according to the latest data from Leichtman Research Group.
According to the research firm, 8 percent of U.S. households subscribe to broadband services without also having a pay TV subscription. That compares to the 70 percent of U.S. households that pay for both broadband and pay TV. But that minority of broadband-only subscribers is doing so mainly due to the cost of pay TV services, not the convenience of online video as a replacement.
The common perception is that users who “cut the cord” or go without cable TV are largely relying on online video services like Netflix or Hulu Plus instead. But LRG reports that the percentage of broadband-only households that watch online video is only slightly higher than those that pay for cable. About 19 percent of broadband-only users watch online video daily and 55 percent do so weekly. By comparison, 17 percent of those who subscriber to cable TV and broadband watch online video daily, and 48 percent do so weekly.
Only 5 percent of broadband-only subscribers say they have kicked the pay TV habit because they can find what they want to watch online instead, and just 2 percent cite Netflix in particular as a reason for cutting the cord. A whopping 28 percent of broadband-only households cite cost as the main reason they don’t subscribe to cable, with another 26 percent saying they just don’t watch that much TV. 18 percent claim to have no need for a pay TV subscription. Income also seems to play a big part in who decides to pay for cable and who doesn’t: Those who go broadband-only have an household income that’s 10 percent lower than average and 20 percent lower than those that subscribe to broadband and pay TV.