More Content Providers Marketing to the Pay TV Audience

TV continues to be a key way for advertisers to reach consumers. But content providers can also find an audience willing to pay for access to unique and engaging programming. While the pay TV market was originally owned by cable companies, the number of providers in this sector has grown in recent years and so has the competition.

During the recession, some analysts believed that U.S. consumers were cutting the cord to pay TV service in favor of watching free content online. However, new research from the Consumer Electronics Association (CEA) finds that consumers still intend to pay for TV. Here’s what consumers say their intentions are over the next 12 months:

  • Unlikely/​very unlikely to cancel pay TV services: 76%
  • Somewhat likely/​somewhat unlikely to cancel: 14%
  • Very likely/​likely to cancel: 10%

In the U.S., over 96% of households own a TV. Currently, about 88% of households are paying for TV. This figure marks a big increase since 2005 when about 20% of consumers relied on antennas only for reception on at least one TV. Now, only 8% of consumers are watching antenna reception-​provided TV. Another big change in the pay TV market has been the erosion of cable’s dominance. In 2005, over 60% of consumers paid for traditional cable TV service. Here’s how the market look this year:

  • Cable TV: 53%
  • Satellite TV: 32%
  • Fiber-​optic TV service from phone company: 10%

CEA analysts also echoed another trend revealed by other studies on this topic – consumers are watching video content on a variety of devices. While TV is the top device for now, computers and smartphones command measurable market share. Content providers have new ways to reach viewers but they must market more than ever to stand apart from the competition.

[Source: Cord Cutting and TV Service. CEA Market Brief. May 2011. Web. 22 Jun. 2011] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.