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J.D. Power: Cord-cutting Overblown

30 Jun, 2011 By: Chris Tribbey

All this talk of American consumers canceling their pay-TV service in favor of other options is just talk, according to a new report released by J.D. Power and Associates.

In its residential pay-TV survey, the firm found just 3% of customers had recently canceled their pay-TV subscription in favor of online or other options, though the cord-cutting trend varies by age, with 6% of Generation Y consumers cutting the cord, compared with just 2% of baby boomers.

“The predictions of the demise of television subscription service as we know it are clearly premature,” said Frank Perazzini, director of telecommunications at J.D. Power and Associates. “The popularity of services such as Netflix and Redbox is a clear indication that consumers are enjoying the availability of alternative viewing options. However, with 52% of television customers reporting that they still watch regularly scheduled programming as it is broadcast, the current model will remain viable for the next two to three years, at a minimum.”

The study, conducted in April and surveying more than 6,800 households, rated customer satisfaction of pay TV across six factors, including variety of content, ease of use, customer service, billing, price and promotions. Overall pay-TV satisfaction averaged 743 on a 1,000-point scale, J.D. Power reported. Netflix and Redbox also scored very high among pay-TV subscribers.

More than a quarter of respondents said they watch video on mobile devices

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