CEA: Consumers Tuning Out Over-the-Air TV

A new study by the Consumer Electronics Association makes the case for incentive auctions for broadcast spectrum, finds just 8% of U.S. TV households rely on OTA.

New research from the Consumer Electronics Association finds consumers are relying less and less on over-the-air TV signals and few U.S. households have interest in canceling their pay-TV service.

In a phone survey (available here) of 1,256 adults conducted in December 2010, CEA found the number of homes that rely on over-the-air signals for TV programming plummeted last year to 8% of all U.S. households with TVs. Over-the-air TV viewing has been steadily declining since 2005, according to CEA’s research.

“Over-the-air TV was once the defining distribution platform,” said Gary Shapiro, CEA president-CEO. “But using huge swaths of wireless spectrum to deliver TV to homes no longer makes economic sense. Congress should pass legislation to allow for incentive auctions so free market dynamics can find the best purposes for underused broadcast spectrum, such as wireless broadband.”

The study also found that pay-TV providers face little threat of their customers canceling their service in favor of over-the-air broadcast TV and Internet video. Seventy-six percent of respondents said they were unlikely or very unlikely to cancel pay-TV service. By contrast, just 10% of households said they were likely or very likely to cancel pay-TV service.

“Contrary to the National Association of Broadcasters’ assertions, antenna sales are falling and cord-cutters are not shifting to over-the-air television, but rather to the Internet. The only cord being cut these days is the one to the antenna,” Shapiro said. “It’s time we accept this shift away from over-the-air TV as an irrevocable fact of the TV market. The numbers tell the story.”

While the survey found consumers were unwilling to cancel pay-TV service, CEA said more and more are viewing Internet video from Hulu, Netflix and others on their TVs, which is still the dominant device to watch video content. Nevertheless, computers, car video devices and smartphones are increasingly being used to watch video content.

BRAND CONNECTIONS

CEA recently found that 96%, or 114 million, of U.S. households own a TV. Therefore, there are just 9 million homes now exclusively watching over-the-air TV. By contrast, consumers are quickly adopting smartphones and alternative display devices such as tablet PCs, and wireless broadband data use is increasing. According to CEA’s 13th Annual Household CE Ownership and Market Potential Study, the percentage of U.S. households owning a smartphone is projected to increase from 33% in 2010 to 45% in 2012.


Comments (22)

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mike tomasino says:

May 31, 2011 at 7:06 pm

Let’s just look at the natural bias of the poll. It was a telephone poll, therefore people answering the poll had landline telephones. Since landline telephone rates have been dropping steadily for the past 10 or so years (I haven’t had a landline since 2003) what your left with are people who naturally resist change. Just that fact invalidates the results. Also, if the demographic that is most likely to “cut the cord” on their phone is also the demographic most likely to “cut the cord” on their TV (young techy kids) then that also invalidates the results. Also, many people who have landlines are on “no call lists”, screen their calls, or hang up on pollsters. So, even if the call selection was completely unbiased, the results are that only 8% of people who have landlines, aren’t on a no call list, don’t screen their calls, and don’t hang up on pollsters, still get their TV free over the air. And, this very change resistent and open group are very unlikely to change.

    Wagner Pereira says:

    June 1, 2011 at 1:26 am

    While I do not disagree that the report had an intended purpose (and does not tell us anything that we do not know), you are as guilty as they are of bias – as you clearly did not read the report “The report described herein was formulated by the Consumer Electronics Association. This report presents the findings of a telephone survey conducted among two national probability samples, which, when combined, consists of 1,265 adults, 643 men and 622 women 18 years of age and older, living in the continental United States. Interviewing for this CARAVAN® Survey was completed on December 9-12, 2010. 1,015 interviews were from the landline sample and 250 interviews from the cell phone sample.” That number is pretty darn close to cellphone only household estimates.

mike tomasino says:

May 31, 2011 at 7:28 pm

Yet, 10% of this change resistent and open group are considering cutting their pay-TV service. What is also suspiciously absent is a poll of CEA members who manufacture (or sell) OTA antennas on their antenna sales. If the data supported the premise why not publish it? We know that Antennas Direct’s 1Q sales were up 225% and Mohu sold 2400 antennas in a week, why not publish CEA member data? I have a feeling it doesn’t support the goal of killing off free wireless DTV.

    Wagner Pereira says:

    June 1, 2011 at 1:28 am

    Again, your “change resistant” comments are off base, as you did not read the report. By doing that, you are as guilty of bias as they are.

    mike tomasino says:

    June 1, 2011 at 10:05 am

    Okay, so you got me there, but let me ask this question. How many people would you have to call to get 250 people to answer a poll conducted through unsolicited cell phone calls? Part of the benefit of having a cell phone is that I don’t get unsolicited calls, if I do get one I simply reject it. The same is true for landline users with caller ID. I don’t see a telephone poll to be a useful indication of anything, especially if it contains leading or misleading questions. And, by the way I am biased against Gary Shapiro and company.

    Wagner Pereira says:

    June 1, 2011 at 12:13 pm

    Unfortunately, there is not enough information on Page 5 to determine that (It would be very interesting to see the exact Q and read exactly how biased the CEA constructed it). They did not even include the total number of phone calls made to obtain their sample. The Land Line section was random digit dialing, so results on that would be very VERY low as you hit many disconnects and non-working numbers. The Cellphone sample apparently was from a list of known cellphones numbers which should have increased the response rate on that section. However, we just don’t have the information provided to determine the response rate.

    Wagner Pereira says:

    June 1, 2011 at 12:45 pm

    This study was conducted the 2nd week of December 2010. This would also LOWER the response rate DRAMATICALLY as people do not have the time to spend answering Research Qs in December – when they are Xmas shopping, dealing with Xmas Parties and Holiday Planning. Many Research firms will not even conduct research in December because of the horrible response rate. An even better question to ask – why did the CEA hold these results just short of 1/2 year before releasing them?

    mike tomasino says:

    June 1, 2011 at 3:01 pm

    Maybe because Shapiro quoted the 8% figure without support last week and I called him on it. Maybe so he could bring them out at the House spectrum hearing today. Based on the Nielsen numbers some markets are up and some are down. Definitely no decisive movement either way. Since it looks like the economy is double dipping, it will be interesting to see how things pan out over the next year.

Ellen Samrock says:

May 31, 2011 at 7:29 pm

And, of course, look who funded or conducted the poll, the CEA. Hardly an unbiased group. It’s no secret that you can easily sway the results of a poll by how the questions are phrased.

    Wagner Pereira says:

    June 1, 2011 at 1:39 am

    Absolutely. As stated in the methodology “The report described herein was formulated by the Consumer Electronics Association.” It is very easy to design a Q for your intended purpose, especially if the CEA formulates the Q. However, someone would have to have their head in the sand to believe that more than 10% of the USA Population uses OTA (that is, until it becomes a near life or death situation in a matter of survival and Cable/Satellite isnt available any longer). Considering that DBS pizza pans blow off their masts in winds of 85 MPH and often lose alignment at much lower wind speeds – and routers/distribution amps for cable systems have at best 6-8 hours of battery backup before they reach your home (if the infrastructure survives), OTA is still needed in local (and even national) emergencies. Just as with any emergency, you have to plan for it – and hope to never need it – and that is the real tactic Broadcasters should be using in this battle. Ask anyone who has sent reporters into disaster areas and you quickly find out that most Cell Towers have no generators and die after 6-8 hours of no electrical power – just like cable routers/distribution amps. They cannot be counted on when needed in Emergencies.

    mike tomasino says:

    June 1, 2011 at 10:22 am

    But, you can easily give emergency nightlight service with 29 channels. If all broadcasters plan to give consumers is emergency nightligt service then taking 120 MHz from broadcasting is a great idea. With modern encoders a single station could easily run 5 SD signals. On the other hand, If they are going to provide free HD and mobile and other services then they need the full 394 MHz. In fact they could use more since there are already serious co-channel and interference problems with the current allocation. If broadcasters want to save their spectrum they need to promote their free wireless service.

    len Kubas says:

    June 1, 2011 at 4:23 pm

    who would buy tvs?

Tanya Pavluchuk says:

June 1, 2011 at 10:55 am

Usage of OTA signals varies from market to market. Some areas are 29% or higher.
CEA is pronounced “See…Ya”

    Wagner Pereira says:

    June 1, 2011 at 12:05 pm

    Please do tell with some documentation as to the markets, especially when you look at the 10Q filings for Cable and DBS Companies, there arent enough Households in the USA to support your premise while showing the number of basic subs for these companies.

    mike tomasino says:

    June 1, 2011 at 1:36 pm

    Well, based on Nielsen research some of those markets are Boise, ID; El Paso, TX; Harlingen, TX, and Fairbanks, AK. http://www.tvb.org/planning_buying/4722/4729/72555 Since Cox Communications estimates Las Vegas to have 80% MCV penetration (http://www.lvbusinesspress.com/articles/2011/01/31/news/iq_41644726.txt) and Nielsen has it at 91.9% that would seem to bring into question who is correct. Could it be possible that Nielsen could be off by over 10%? Okay maybe the privately held, nonreporting, cable company is off the mark.

Meagan Zickuhr says:

June 1, 2011 at 11:14 am

Hey…. good to see that the CEA has an “Insider” on here responding to all the comments! Gary’s getting a little worried!

    len Kubas says:

    June 1, 2011 at 12:02 pm

    You might want to pay attention. The insider went after all the folks who weren’t paying attention or reading the article, but he is clearly pro-broadcasting, saying that broadcast works in emergencies, when nothing else does.

    Wagner Pereira says:

    June 1, 2011 at 12:02 pm

    Its clear you didn’t read my responses if that is your take away.

Hans Schoonover says:

June 1, 2011 at 11:44 am

In the future: Consumers could watch live TV without a set-top box, Consumers could access live programming on Web-capable devices, such as tablets and Program guide is stored on remote services allowing for additional features like connections to social media and Web-video services
…. In this world TV station profits would no longer be affected by people taking their antennas down. Local stations shall be the “Mecca” for online, neighborhood business and new media advertisers where local, regional and national players want to be seen.
… Rich Lyons 818 516 0544, call me for the MPC Plan

    len Kubas says:

    June 1, 2011 at 12:03 pm

    live tv stored on servers. dumb, just plain dumb.

    Warren Harmon says:

    June 1, 2011 at 2:46 pm

    Ditto!

bob nelson says:

June 3, 2011 at 8:38 pm

I think this is largely due to the fact that people forgot about OTA TV. Only in the past few years have this become a valuable option. Most people are unaware that it’s now possible to receive FREE High Definition and Digital broadcasts over-the-air (OTA) using a simple antenna connected to your television set! Get $5 Off the #1 Selling Indoor Antenna. “Leaf Indoor Antenna” Go to http://www.killthecablebill.com/ to get your Promo Code.


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