A new type of cord-cutting: Snipping broadband
People are starting to chop their subscriptions to save money
December 27, 2016
When you think of cord cutting, you undoubtedly think of people giving up their subscriptions to pay TV in order to save money.
But it may be time to broaden that definition.
There’s new evidence that people are cutting the cord on something else as well – broadband internet.
The finding comes in a new report from Ovum, a media and telecom research firm, which notes that several companies have seen more than one quarter of decline in broadband.
It notes that most U.S. telecom providers have been losing landline or cable subscribers for years. But now that’s expanded to include broadband.
“Cord-cutting started in landlines and gave way to cord-cutting in pay TV in the U.S. We are now entering the realm of triple cord-cutting,” says Kristin Paulin, a senior analyst at Ovum.
During third quarter, AT&T and Windstream saw declines in all three services they offer (broadband, cable and landlines), while Frontier suffered losses in phone and internet.
Verizon experienced two quarterly declines in broadband over the past 15 months.
A few companies did post broadband gains during third quarter, including Comcast and Mediacom. Others, such as Cablevision, were flat.
Still, Ovum forecasts that broadband decreases will increase over the next few years.
Behind the drops
There are a number of things playing into the broadband decline.
One is certainly the rise of mobile. There’s now a significant slice of the population that relies on their smartphones exclusively for their connectivity outside of work.
They can skip the expense of broadband by getting an unlimited data plan and using it for all of their internet needs. The Pew Research Center says 13 percent of U.S. adults use smartphones only to get on the web, up from 8 percent three years ago.
Too, the wide availability of wifi makes a broadband connection less necessary than in the past. The number of wifi hotspots quadrupled from 2011 to 2015, according to Informa, and there are more than 50 million hotspots worldwide.
Finally, people want to save money. By eliminating a cable, broadband or landline subscription, or just chopping all three, a family can save hundreds or thousands of dollars each year.
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