Report: US Cord Cutters Will Outnumber Pay-TV Subscribers for the First Time by End of 2023
New data from Insider Intelligence Shows that for the first time in history, cord-cutters and cord-nevers are about to outnumber cable subscribers.
If 2022 was a bad year for the streaming industry, it seems that 2023 has been just as bad for cable TV. The largest cable and satellite providers combined to lose 1.8 million users in the third quarter of this year alone, and there are portents that the end of the year could spell even more trouble for pay-TV operators.
- New data from Insider Intelligence suggests that by the end of 2023, there will be fewer pay-TV subscribers than cord-cutters and cord-nevers.
- The group of American viewers who have left cable or never had it will number 144.1 million by year’s end.
- By 2027, Inside Intelligence expects the number of non-pay TV subscribers to effectively double those still left with pay TV.
How Many Cable Subscribers Are Left in the United States?
The number of pay-TV subscribers peaked in 2014 when over 100 million households in the United States had a cable or satellite subscription. In September of 2023, Nielsen measured that the number had dropped to 75.3 million homes, and the number is continuing to fall.
A new report from Insider Intelligence suggests that the combined number of cord-cutters and cord-nevers (audiences who have never subscribed to a cable or satellite service) will total 144.1 million. Conversely, the total number of viewers (not households) with access to pay TV will have fallen to 121.1 million. Cord-nevers will rise to 40 million by the end of this year and would make up a critical customer base for cable companies if they were converted to pay-TV subscribers.
Insider Intelligence’s numbers do not count live TV streaming services like DIRECTV STREAM and Fubo as pay-TV providers, but the data is nevertheless an extremely tough portent for cable providers to swallow. It’s the latest indication in a long line of signs that pay-TV is circling the drain, even as streaming platforms scramble to try and replace them.
“Regardless of how one defines pay-TV, there is an unmistakable attrition in the number of people who are willing to pay upwards of $100 a month for a live TV bundle,” said Paul Verna, vice president of content at Insider Intelligence. “The cord cutters have won.”
Will Carriage Deals Like Spectrum-Disney Agreement Save Cable?
There is seemingly one last hope for pay-TV providers: finding a streaming service to pair their cable or satellite plans with. That’s exactly what Spectrum did earlier this year, when it got Disney to agree to give all of its cable subscribers free access to ad-supported Disney+, in exchange for a lump sum for those subscribers and higher carriage fee payments for some of Disney’s cable channels.
As the cost of streaming continues to rise, users are crying out for a way to watch TV that they can afford. A report from summer found that most streaming churn this year has been due to price concerns, and bundling cable plans with subscription video services for a lower price than the two products would be available for separately creates a value proposition in the minds of consumers.
But why would streaming services go along with this? Won’t the collapse of cable mean more customers for streaming platforms? Maybe, but the problem is that when a cord-cutter cancels their cable or satellite, they don’t automatically become Netflix or Prime Video subscribers. They have to pick and choose which streaming services they subscribe to, and that leaves streaming providers in essentially the same position they would be in if that customer had never left cable: how do they stand out amongst the competition in a crowded market?
By choosing a cable provider to offer their streaming service with, streaming operators get to instantly boost the size of their audience and provide a new video experience that subscribers of that cable service don’t have to work hard to access. Streamers don’t get to keep 100% of the subscription money from those users like they would if the customers in question had signed up directly for their platform, but they do still get to collect revenues from advertisers when cable customers sign on to stream their ad-supported content.
Of course, even if cable providers make deals with streaming services, it will only delay the inevitable. The cable TV model is a dinosaur, and while streaming services have yet to come up with a viable scheme to replace it, there’s no putting the milk back in the bottle. Cable is on its way out, as Insider Intelligence’s new data makes all too clear.
Disney+
Disney+ is a video streaming service with over 13,000 series and films from Disney, Pixar, Marvel, Star Wars, National Geographic, The Muppets, and more. It is available in 61 countries and 21 languages. It is notable for its popular original series like “The Mandalorian,” “Ms. Marvel,” “Loki,” “Obi-Wan Kenobi,” and “Andor.”