nScreenMedia OTT multiscreen media analysis

CandW discuss what cord-cutting really means

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New Magid research shows that the number of pay TV subscribers was flat over the last two quarters. However, attitudes to the service have shifted, and vMVPDs like Sling TV are changing to keep ahead of the curve.

Chapter 1: Pay TV subs flat, interest in canceling goes up (2:10)

New Magid research says that pay TV penetration remains flat, but that interest in cutting the cord has increased. The company says 7.9% say they are likely to cancel their pay TV service in the next 12 months, up from 6.1% last year. TiVo data from Q4 2017 puts the number even higher. 7.3% say they will get rid of traditional pay TV altogether while 5.7% say they will cancel it in favor of an online service.

Millennials are more likely to cancel according to Magid, with 14% saying they are likely to cut the cord. Even 10% of live sports enthusiast think they can live without cable.

Chapter 2: Sling TV boosts price, fine-tunes offering (9:30)

Sling TV has made some adjustments to its service. The monthly subscription for the entry level Sling Orange has been raised $5 to $25. There is no change to Sling TV Blue or the combined Orange+Blue prices.

More interestingly, the company is lowering the barriers to people using the service. It is introducing a free tier of service with 100 hours of TV and movie content available to watch without a subscription. Non-subscribers can buy pay-per-view events through Sling TV and subscriber to several channels on a standalone basis. Sling TV is hoping to win back former subscribers with the free service, though they will need to have Roku to give it a try. Sling TV will roll the interface out on other devices later in the year.

Chapter 3: To OTA or not to OTA? (14:40)

Unlike other services, like YouTube TV and FuboTV, Sling TV has not tried to provide all the major local channels as part of the channel bundle. This strategy has allowed the service to maintain a very low entry level cost. Instead, the company encourages users to use over-the-air (OTA) channels. The customer must get an antenna and buy a $50 AirTV box to do it, and Sling TV will automatically integrate them into the guide.

Will is very skeptical of this approach. He likes the local channels to be bundled in with service. I think it’s a good option if someone is willing to go to the trouble of doing it. They reap the rewards of a lower subscription price.

Chapter 4: The definition of cord-cutting (19:00)

For those people that cut traditional pay TV and add a vMVPD, are they really cutting the cord? We discuss the blurring of the boundaries between pay services. Both of us agree it is not simple to make such a clear differentiation. The good news is that there is far more choice for the consumers than there has ever been.

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