Survey Finds Little Video Cord Cutting So Far, But DVDs Have Suffered

An annual study of consumer video consumption habits and platforms conducted by Frank N. Magid Associates reveals that despite the increased use of alternative video viewing platforms (like video-on-demand, set-top boxes, instant streaming, and mobile apps), the vast majority of consumers intend to continue to maintain their traditional subscriptions with cable, satellite, and telco TV providers.

So far, online and other alternative video channels are mostly complementary to existing multichannel video entertainment services. Consumers using the greatest number of alternative platforms also tend to spend the most money on traditional subscription services, the study found.

But the study also suggests the potential is far greater.

Only 10 percent of consumers express an interest in trying TV show and movie viewing from the Internet to a computer or tablet screen. In contrast, interest surges in viewing this content on a TV screen via a computer connected to the Internet, and it climbs even higher for devices designed specifically to stream content to the TV, such as AppleTV and Roku.

"The average American's capacity to consume video content is impressive," said Maryann Baldwin, Vice President of Magid Media Futures. "As new video viewing platforms such as instant streaming and mobile apps proliferate, consumers are simply adding them to their portfolio of video viewing options. Our research indicates that this is definitely not a zero-sum game -- at least at this point, it appears that traditional subscription services and alternative viewing platforms can coexist with services like 'TV Everywhere' locking in revenues for traditional providers."

In addition, the study indicates that when the availability of Internet content has caused consumers to cancel their traditional service subscriptions, these circumstances remain the exception. Only a very small minority of consumers are even considering cancelling their subscriptions.

Only one percent of consumers report that they have cancelled their subscription service in favor of accessing content available on the Internet, and only 2.5 percent of consumers use Internet content exclusively.

In terms of future cancellations, only three percent of consumers report that they are even considering cancelling their traditional subscriptions without replacing it with a competing subscription, suggesting a relatively stable subscriber base for traditional providers.

Purchase and rental of DVDs continue to be most at risk from the growth in use of alternative video viewing platforms.

The online survey was conducted in October 2010 using a nationally representative sample of 1,208 adults age 12 years or older.

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