People are cutting the cord at a faster rate than previously expected, according to market research firm eMarketer.
In 2017, 22.2 million USA adults will cut the cord on cable, satellite or telco TV service – up 33% over 2016 – the researcher now predicts.
‘Last year, even the Olympics and the presidential election could not prevent younger audiences from abandoning pay TV’. While the pace of that growth is slower – a more modest 5.8 percent this year – the total number of cord-nevers is higher. eMarketer says there will be 34.4 million USA adult cord-nevers in 2017.
Only 15.4 million people were initially predicted to cancel, researchers explain.
The firm attributes its revised forecast, in part, to the growing list of live streaming and over-the-top platforms that are now available.
When you combine the cord cutters and cord-nevers, there will be 56.6 million US non-pay TV viewers this year.
As a result, TV’s share of the total media ad spending budget in the USA will drop to 34.9 percent this year, and is expected to be under 30 percent by 2021.
‘Younger audiences continue to switch to either exclusively watching [over-the-top] video or watching them in combination with free-TV options, ‘ senior forecasting analyst at eMarketer Chris Bendtsen explained. A new report by eMarketer notes that ad investment will expand just 0.5% to $71.65 billion this year, down notably from the $72.72 billion predicted in the company’s original first quarter forecast for 2017.
Still, 2020 – another big political advertising election and Olympic TV year – will see a boost of 2.5% to $74.03 billion.
Overall, 196.3 million U.S. adults will watch pay TV (cable, satellite or telco) this year in the United States, down 2.4% over 2016, eMarketer predicts. By 2021, it will continue to decline, dropping to 181.7 million.
That decline is mostly driven by television viewers under 55, as the number of people older than that who pay for television is expected to keep growing over the next four years.
“The acceleration of cord-cutting is the result of several factors”, said eMarketer principal analyst Paul Verna. Second, networks such as HBO and ESPN have launched standalone subscription services that allow users to tap those channels without a cable subscription.
At the same time, USA adults are spending less time in front of the TV.
Digital video viewing, meanwhile, has jumped up 9.3 percent over 2016 to reach 1 hour, 17 minutes. USA adults will consume 1 hour 17 minutes of digital video this year, up 9.3% over 2016.