A recent study by equity research company Cowen reports that 33% of cable TV subscribers are paying promotional deal prices for their current subscriptions, rates that will soon expire, and bump them up into higher prices. The survey was conducted June 26-27 with 1,021 U.S. consumers for Cowen’s Q2 cable TV and satellite video report.
Cowen reports that 20% of those paying promotional rates for Cable TV plans are on deals that will expire within the next 21 months. Viewers will be in for a significant price hike once those promo rates run out. Only 10% of the survey respondents reported being grandfathered into a “price for life” plan that guarantees no inflated bills.
Although these cable subscribers are about to be paying exorbitant prices for TV, 76% of those surveyed by Cowen in the latest research said they’re using a streaming service along with their cable subscription. OTT streaming is increasingly becoming a staple even among die-hard cable fans. Of those surveyed, 59% reported using Amazon Prime Video with 40% subscribing to Hulu, up from 33% last year.
“The rapid increase is largely due to the onset of (1) the Streaming Wars (providing not just a multitude of choices but new low-cost SVOD as well as free AVOD entrants), (2) the current pandemic lockdown, and (3) the rise in unemployment as consumers test-drive low-cost/free solutions to rationalize video wallet share,” said lead report author Gregory Williams.
This just goes to show that even if you sign up for a cable plan at an introductory rate, you’re headed for a hefty price increase once that promotional window expires and will be stuck paying full price for your entertainment – content you could be getting via an add on to the streaming service you probably already have a subscription to.
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