The Uneasy Crown Atop King Content

[Commentary] Over-the-top video has gotten plenty of attention lately, in large part because Apple is trying to correct the mistakes it made with the first version of Apple TV. Part and parcel to the discussion is whether consumers will cut off pay TV services in favor of these Internet-based options.

Yankee Group research shows there indeed was a measurable amount of momentum growing toward video cord cutting. What's now just a trickle certainly could turn into a stream and ultimately a raging river. It's not there yet, though, and that is an important distinction that sometimes gets lost in the reporting. People don't think nearly as much about their pay TV options as we'd like them to. In fact, it's a pretty quick decision, and it's based largely on economics. Consumers will migrate away from pay TV services if and only if the economics dictate and it's exceedingly easy to change. Content owners play the biggest role in making the transition easy. Among those consumers that tell us they'll never cancel pay TV service, which sits at 17% right now, more than 50% said they enjoy the convenience of the service and the variety offered. If content owners were unified on the issue of offering their product through every channel possible, the number of consumers unwilling to let go of pay TV would plummet. Content clearly remains the most important and often missing piece of the consumer shift to new viewing habits. Until owners of that content are incented to move in lockstep, we'll continue to see an uneven movement that is significantly more nuanced than is being reported.