Cord cutting knocks cable-TV penetration down to 1994 levels

Crank up the Weezer and throw your self a My So-Referred to as Life watch occasion tonight, as a result of the cable-TV business simply hit a very retro milestone.

Cord cutting accelerated at such a speedy tempo final yr that the penetration of U.S. households paying for conventional TV providers is down to levels not seen for the reason that mid-Nineties, in accordance to a brand new report from analyst agency MoffettNathanson.

Over the course of 2020, cable and satellite tv for pc TV firms shed 6 million subscribing households, the agency estimates, a decline of seven.3%.

And the rise of cable-like streaming providers—reminiscent of Sling, YouTube TV, and Hulu’s dwell TV service—has not been dramatic sufficient to make up the distinction, since solely about one-third of twine cutters subscribed to an over-the-top equal.

MoffettNathanson estimates that twine cutting fell 4.4% final yr even with cable-like streaming providers factored in. “The media business simply suffered the worst yr ever for cord-cutting, whether or not measured solely amongst conventional distributors or after together with vMVPDs,” the analysts wrote.

Penetration of pay-TV providers was down to about 60% amongst residential U.S. households, in contrast to nearer to 90% solely a decade in the past. Complete pay-TV penetration together with business prospects was down to 61%. “[R]emarkably, we haven’t seen this since earlier than the launch of the primary satellite tv for pc TV service, DirecTV, in 1994,” the analysts wrote.

Cord cutting isn’t a brand new downside for cable operators, however the coronavirus pandemic appears to have exacerbated it. One cause for that was the cancellation of so many dwell sporting occasions final yr, which left many shoppers with one much less cause to pay for cable TV. Though MoffetNathanson’s report notes a slight uptick in subscriber traits for the third and fourth quarters, the broader shifts in viewing habits are seen as everlasting.