Study shows uptick in US broadband users without pay-TV service

October 2, 2013 | By More

More broadband connected households in the United States are foregoing pay-TV services, a new study from Leichtman Research Group shows.

LRG said the number of households that had a broadband service but didn’t subscribe to any pay-TV service increased 12.5% in 2013, after remaining essentially unchanged in 2011 and 2012.

broadband without pay tv

But the numbers are small, said LRG President and Principal Analyst Bruce Leichtman. The report, “Broadband Access & Services in the Home 2013,” said 9% of all households get broadband, but do not subscribe to a multi-channel video service — compared to 8% the past two years.

Leichtaman said the increase more likely shows that “the multi-channel video business is now essentially flat – at about 86% of households,” and didn’t necessarily indicate a tradeoff of broadband for video services.

He also said economic may play a factor.

“The broadband/no multi-channel households tend to be more economically motivated ‘price seekers’ than they are ‘alternative video seekers,” Leichtman said, spending about 15% less per month on broadband service than those with a multi-channel video subscription.

In August, LRG reported that the thirteen largest multi-channel video providers in the U.S. — representing about 94% of the market — lost about 345,000 net additional video subscribers in 2Q 2013. In 2Q 2012 and in 2Q 2011, the multi-channel video industry lost about 325,000 subscribers

LRG today, meanwhile, also pointed out that overall online penetration, at 83% of U.S. households, also is flat. The best potential for growth being the ability to convert “those online who do not subscribe to a broadband service,” Leichtman said.

LRG’s report also showed:

  • Overall, 83% of households get an Internet service at home, and 55% of adults access the Internet on a Smartphone. While the percentage of households getting Internet service at home is similar to last year, those accessing the Internet on a Smartphone increased from 44% last year.
  • Of that 83% connected to the Internet at home, the study said, 94% of them are connected through a broadband connection, up from 92% last year, 75% in 2008, and 33% in 2004.
  • Availability of the Internet is now, essentially, universal, the report said. Less than 1% of the 1,304 homes surveyed said they didn’t have a broadband service available in their area, down from 6% in 2008.
  • 64% of broadband subscribers also access the Internet on a Smartphone — compared to 52% last year
  • 19% of all not online at home access the Internet on a Smartphone — compared to 12% last year
  • 1% of households paid to subscribe to Internet service at home in the past year, do not currently subscribe, and do not plan to subscribe again in the next six months
  • 42% of households with annual incomes less than $30,000 do not use a laptop or desktop computer at home — compared to 8% with incomes of more than $30,000.

The findings are based on a telephone survey of 1,304 households from throughout the United States.

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Category: ANALYSIS

Jim ONeill

About the Author ()

Jim O’Neill has been a business journalist since 1992, and has been writing about the digital media industry since 2007. He formerly was the editor of industry journals FierceIPTV and FierceOnlineVideo, and has worked as an industry analyst for international research firm Parks Associates. He currently is CEO and Editor of theConvergence.tv, a newsletter that takes a deeper look at the trends and happenings in the digital media industry, and continues writing research and white papers on a variety of topics in the sector. He can be reached at jim@theconvergence.tv

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