October 27, 2014 at 6:16 pm ET
Cable or Online? Medium for Watching TV Programs Determined by Age
How Americans watch TV programs comes down to one major factor: age.
Morning Consult polling suggests that how old you are is the primary indicator of how you are entertained. While 5 percent of those between the ages of 45 and 64 said they watch most of their television online, 40 percent of millennials are accessing their favorite shows and movies via streaming services such as Netflix and Hulu.
This month, both HBO and CBS announced they would make programming available to consumers in an a-la-carte format, meaning separate from the traditional cable bundle. Anyone with Internet access, and a willingness to pay, can subscribe to CBS “All Access” and HBO’s “HBO GO” and polling data indicate that those moves are aimed at attracting younger customers in the wireless generation.
Sixty-two percent of poll respondents between the ages of 18 and 29 said they will use Netflix or Hulu to watch television series or movies during the next six months to a year. A plurality, 45 percent, of those between ages 30 and 44 said the same. That likelihood declined for older respondents: 19 percent for the 45-to 64-year-old age group and 8 percent for the 65-plus crowd.
But none of this spells the end of existing cable packages, according to John Bergmayer, a senior staff attorney with Public Knowledge, a Washington-based advocacy group that supports increased public access to the Internet.
“This is not a battle of business models pitting a la carte versus bundles,” Bergmayer said. His organization hopes the increase in a-la-carte services will drive more competition, something Bergmayer said has been lacking. “We’re promoting online content because we promote competition,” he said. “We want there to be more choice.”
Services from content producers such as HBO and CBS can help increase leverage against the cable companies, according to Bergmayer, who added that doing so could mean cable providers are forced to provide more options in their packages, as opposed to one super-sized bundle.
Competition has been sparse in the cable field; most major companies don’t even operate in the same cities as their competitors. While the Cable Act of 1992 regulated the industry in a way that aimed to promote competition, the emergence of the satellite television industry gave legislators enough peace of mind to take the training wheels off the cable business in the middle of the decade. However, Bergmayer points out, the broadband revolution came into play shortly thereafter, and cable companies operated with little competition as Internet service providers.