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Generation Y not connecting the cord to pay TV

We have been warning about this for years - it’s not cord-cutting which should bother the pay TV services

By PETER WHITE

Published: 9 June, 2011

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We have been warning about this for years - it’s not cord-cutting which should bother the pay TV services. It’s the cords that are not being connected.

Cord-cutting, or the lack of cord-connecting, seems to be gaining traction among the “Generation Y” crowd, according to research by Ideas & Solutions in a report called “Must Choose TV: What Gen Y Thinks About Pay TV and Cord Cutting.”

Glen Friedman, president and founder of Ideas & Solutions, said “While the media has focused much of its reporting on the extent of cord-cutting overall, there is little mention of the behaviors and attitudes of vulnerable groups within this key constituency. This is the demographic that completely transformed the music and the phone business and has already started to dramatically reshape the pay TV ecosystem.”

Gen Y pay TV subscribers were segmented into three groups: loyalists, learners, and at-risk. Overall 60% of respondents were either leaning toward or seriously considering “cutting the cord” to their pay TV subscriptions. They are drawn by the allure of OTT providers such as Hulu and Netflix. They also want to control their TV viewing by using a DVR and on-demand services.

Sports fans are more likely to stick with pay TV rather than switch to OTT, which does not offer sports, not yet at least, except for some cricket on YouTube. The young are not permanently attached to OTT. They said they might subscribe to pay TV if their personal situation changes, no doubt meaning “earn more money,” or if the pay TV services start offering what they want.

Ideas & Solutions, which is a marketing consulting company, said the pay TV services should market their services better and target this group. Friedman said, “You have to examine the right audience. If you look at the overall numbers people might say there’s a small number of cord-cutters. But if you look inside certain segments, it’s much larger.” The pay TV companies should also be concerned over the amount of time their subscribers are watching OTT TV rather than pay TV.

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