Roku Says Nearly 1 in 3 U.S. TV Households Have Cut the Cord

Roku July 21 reported that about 32% of U.S. TV households do not have a traditional pay-TV subscription (cable, satellite, telecom), while another 25% of households identified as “cord shavers” scaled back their service during the coronavirus pandemic. When asked about the intent to drop pay-TV in the next six months, 45% of the latter households said they were likely to do so.

Citing data from separate surveys of 7,000 Americans ages 18 and over in March, followed by 2,000 Americans ages 18 and over in May to understand changes amidst the pandemic, Roku found primary drivers for pay-TV termination to be the pandemic and lack of live sports.

“While we entered 2020 with significant momentum around cord cutting, we’re now seeing that the pandemic and the pause of live sports has caused consumers to rethink how they access home entertainment and what they are willing to pay,” Matthew Anderson, chief marketing officer, said in a statement.

Anderson said the abundance of free ad-supported VOD content, free trials to low-cost are contributing to a redo in home entertainment consumption.

Survey respondents said they saved about $75 per month dropping pay-TV, with some of the saving earmarked for SVOD services.

“The vast majority of [respondents] agreed that they are satisfied with their decision and wish they had cut their pay-TV service earlier,” Anderson said.

Value is an important factor in driving cord cutting. Nearly half of all U.S. TV household respondents said they have been watching more, free ad-supported TV during the COVID-19 pandemic than they did before. In addition, 40% of recent households that dropped pay-TV said that access to free trials and extended free trials to premium subscription services helped convince them to cut traditional pay TV service.

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Roku, which helped Netflix launch the subscription streaming video-on-demand market in 2007, offers a platform for third-party SVOD services, in addition to The Roku Channel branded AVOD platform.

Roku found less than 20% of cord-cutting households said they would re-subscribe to pay-TV when live sports returns. Instead, 31% said they were likely to subscribe to a live sports streaming service, such as ESPN+ and fubo TV. More than half (52%) of traditional and “cord shaver” households said they are likely to reduce their pay-TV package if televised live sports does not return.

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