Report: 25% of U.S. TV Homes Have Cut the Cord

According to GfK, U.S. TV households are embracing alternatives to cable and satellite reception. Levels of broadcast-only reception and ...

71% of U.S. consumers have pay TV, plan to keep it
71% of U.S. consumers have pay TV, plan to keep it

According to GfK, U.S. TV households are embracing alternatives to cable and satellite reception. Levels of broadcast-only reception and Internet-only video subscriptions have both risen over the past year, with 25% of all U.S. TV households now going without cable and satellite reception.

The research indicates that 17% of U.S. TV households now rely on broadcast-only ("over-the-air") reception, up from 15% in 2015. Another 6% say they only use OTT services such as Netflix (NASDAQ:NFLX), Amazon (NASDAQ:AMZN) Prime, Hulu, or YouTube and do not have traditional broadcast or pay TV reception at all; this compares with 4% a year ago.

TV households with a resident between 18 and 34 years old are much more likely to be opting for alternatives to cable and satellite; 22% of such homes are using broadcast-only reception (vs. 17% of all U.S. households), and 13% are only watching an Internet service on their TV sets (vs. 6% of all TV homes). Overall, 38% of 18-to-34 households rely on some kind of alternative TV reception or video source, vs. 25% of all homes.

On the other hand, households with at least one resident age 50 or older have higher rates of subscribing to cable or satellite services. Some 82% have some sort of pay TV subscription, vs. 75% of all U.S. TV households. The difference comes almost exclusively in levels of cable subscription, with 46% of 50+ homes paying for cable reception, compared with a U.S. average of 41%.

"The fact that a statistically significant increase in broadcast-only reception occurred over just one year may be further proof that the cord-cutting/cord-never phenomenon is accelerating," said David Tice, SVP in GfK's Media & Entertainment practice. "If you include homes that have no TVs at all - about 3% of all households - then less than three quarters (73%) of U.S. homes continue to have pay TV service, with the attendant implications for all stakeholders - not just the pay TV services themselves, but also networks, content providers, and advertisers."

Broadcast-only reception is more common in TV households earning less than $30,000 per year (26%, vs. 17% among all TV homes) and those with Hispanic residents (24%). Households with incomes of $50,000 a year or more post higher levels of satellite subscription - 27%, compared to an average of 21%.

The study was conducted among 3,009 U.S. households, including representative levels of non-TV, non-Internet, cell-phone-only, and Spanish-dominant homes.

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