Strategy Analytics: Will Big Media Brinkmanship Drive More to Cut the Cord?

4 out of 5 "Must Have Channels" are Free Anyway

BOSTON--(BUSINESS WIRE)-- The bitter dispute between Cablevision and News Corp over retransmission fees has put New York and Philadelphia area subscribers in a crossfire. With Fox programming blacked out, Cablevision customers will need to make other arrangements if they hope to watch the World Series. A new report from Strategy Analytics suggests that the current spat might drive some to question if they need pay TV in the first place.

A nationwide survey fielded by Strategy Analytics in late Q3'10 found that overall, 13% of Americans intend to drop their Pay TV subscription—and not sign up with another provider— in the coming 12 month period. 47% of them cited poor value for money as their primary reason for cutting the cord.

According to this report, the average US household receives nearly 120 channels, yet watches only a handful of those with any regularity. When asked to rank* their five "must have" channels, Pay TV consumers put the "free networks" (CBS, ABC, NBC, FOX) in the top four slots.

“While in the past many have quickly dismissed cord cutting as hype, pay TV operators need to begin taking this phenomenon seriously,” said Ben Piper, Research Director and author of the report. “The fact that four out of the top five ‘must have’ channels ranked by pay TV consumers are free anyway must not be ignored. What kind of value is pay TV offering these subscribers?”

The Insight, “Big Media Brinkmanship: Will Fox and Cablevision Drive More to Cut the Cord,” draws upon Strategy Analytics’ recently-fielded survey of 2,000 Americans. It assesses the cord cutting intentions of US pay TV subscribers by service provider, and analyzes the potential reemergence of a la carte content bundling.

*The Survey Question: Which five of the following television channels or networks do you consider to be “must have” for your household (i.e.,you would not consider using or paying for any television service which did not offer these channels or networks)?

Analyst blog: http://blogs.strategyanalytics.com/dcp/

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Strategy Analytics, Inc. provides timely and actionable market intelligence focused on opportunities and disruptive forces. www.strategyanalytics.com

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Strategy Analytics, Inc.
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Ben Piper, +1 617-614-0700
bpiper@strategyanalytics.com
or
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