Analyst: 22% of households dissatisfied with their pay-TV provider

Michelle Clancy ©RapidTVNews | 01-02-2012

More evidence of cord-cutting has surfaced. According to a new survey, 22% of pay-TV subscribers in the United States are planning to radically change their pay-TV services within the quarter.
Centris, in the course of surveying 7,000 U.S. households once per month, has found that 3% of them will cancel their pay-TV services in the next three months completely, 11% will downsize their existing subscriptions and 8% plan to switch providers.
The further evidence suggests a deep lack of customer satisfaction with current providers, as well as the impact of the availability of cheaper options in the market. A full 36% of switchers and cutters said the performance of their current provider was the issue; 37% said their monthly bills are too steep. Limited channel selection came in at 21%. The attractiveness of over-the-top (OTT) alternatives was only a deciding factor for 10% of respondents, but Centris still issued a warning to traditional operators.
"It is Centris’ view that defending market share will become increasingly difficult for pay-TV providers with increased levels of competition and new OTT viewing options," said researchers. "Enhanced pricing and bundling strategies, as well as effective use of elasticity programs, will need to be deployed to successfully compete."
The firm also warned that telco-based IPTV offers will present a significant challenge in the months to come. Pay-TV households are continuing to drain away from cable and satellite; the latest is Time Warner Cable’s loss of 129,000 video subscribers in Q4. Meanwhile, satellite (DirecTV and Dish Network claim a combined 33 million subscribers) suffers from its high overhead (the dish and installation) and equally expensive service packages, which most often cannot be combined with broadband, let alone a full triple-play offer.