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Report: Just 4% of Rural America Ditching Pay-TV

29 Mar, 2017 By: Erik Gruenwedel

Despite ongoing media buzz about U.S. households cutting the cord with pay-TV, 82% of rural households still subscribe to linear TV — a percentage unchanged for the past two years, according to new data from Innovative Systems, a software and technology company based in Mitchell, S.D. Indeed, only 4% of rural households just subscribe to over-the-top video services such as Netflix, Hulu, Amazon Prime Video and/or online TV.

In a survey of 400 homes conducted by Cronin Communications for Innovative Systems, 3% more homes cut the cord in 2016 compared with 2015. Another 3% added pay-TV service.

Rural areas cover 97% of the nation’s land area but comprise less than 20% of the population (about 60 million people), according to the Census Bureau. Unlike urban America, rural areas often have lower broadband penetration, with older communities predicated on traditional dissemination of media and information (i.e. mail service).

Rural households in 2015 spent a larger percentage of total spending on entertainment than urban households, 6.1% to 5%, respectively, according to Bureau of Labor Statistics at the U.S. Department of Labor.

That said, video streaming increased to 34% of rural homes (from 23% in 2016), and the average number of hours per week increased to 9.73 (from 7.59 in 2016). By comparison, 50% of total U.S. households with a TV subscribe to a streaming video service, with nearly 90% of streaming households using Netflix.

The report found interest in a free on‐demand service for catch‐up TV (“TV Everywhere”) growing among rural households, with 20% of respondents favoring access to such a service. Sixteen percent of pay-TV subs would move to a cloud‐based DVR service if it were available to them.

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