Wireless stays, cable TV goes as poverty problem weighs on household budgets: analysts

With more Americans living in poverty and a stubborn jobs problem causing people to tighten purse strings, they are also rethinking what they spend on telecom and media.

What they are least willing to give up is cell phone service — now viewed as essential, analysts say. And everything — cable, satellite and broadband wireline Internet could be cut as families struggle with finances, those experts say. A mobile voice plan is cheap, and data plans can be less expensive than cable and DSL service, when considering equipment costs on top of service. These trends represent a shift for consumers and add to growing uncertainty over the prospects for cable and satellite television firms.

“In the past, the last service to go was TV. The standard line was that people would rather shut off their refrigerator than their television set,” said Craig Moffett, an analyst at Sanford C. Bernstein. “Now, wireless is probably the service at the top of every list. And after that, it’s becoming a real horse race between video and broadband.”