Is Elk Grove Cutting the Pay TV Cord?

Have you seen the film Ip Man 2?  The martial arts story based on the life of a real Wing Chun grandmaster tops Netflix's list of video rentals particularly preferred by Elk Grove residents.

The site's “local favorites” section provides insight into which movies are being watched where, and not surprisingly, the winners vary widely from town to town. Our neighbors up the road in tony Carmichael and Fair Oaks, for example, are glued to the Italophile drama A Summer in Genoa.

But the growth in subscriptions to this online streaming and by-mail movie service proves an even deeper trend.

If you are considering killing your pay TV in favor of Netflix, Hulu or YouTube, then you are not alone. 

Cable, satellite and digital pay television are losing customers in a big way. Meanwhile, online video streaming companies like Netflix and Hulu are expanding. In the first quarter of the year, Netflix earned more subscribers than any network television providers, including Comcast, DirecTV, DISH Network and Time Warner. According to Business Insider, the Netflix jumped ahead to 22.8 million subscribers, beating Comcast for the first time. Netflix also hit a record high on Wall Street with its stock more than doubling in the past year. Around seven percent of all Americans now subscribe to Netflix. 

The population most inclined to cut the cord from traditional television is “Generation Y,” according to a recent study. Research indicates that these 18- to 29-year-olds may be less attached to their pay TV boxes, more enticed by smaller monthly fees and highly attracted to on-demand viewing. The report, titled “Must Choose TV: What Gen Y Thinks About Pay-TV and Cord-Cutting,” suggests that 60 percent of 18- to 29-year-olds are considering cutting the cord to traditional television. 

So what would a world without pay TV look like? For a start, it could be much cheaper. Netflix and Hulu Plus subscriptions cost $7.99 a month for a streaming-only account, compared to $61.99 for Comcast’s “Digital Starter” service in Elk Grove. Even the cheapest packages from DirecTV and Dish Network — at around $30 — can’t compete with the low prices of online video providers. 

But online services will struggle to compete with pay TV’s coverage of live news, sports and events. The quality of the picture, too, is only as good as your Internet allows with online streaming, while cable, satellite and digital TV boast HD channels and “crystal-clear” viewing.

If Internet video watching continues to gain popularity, it could mean the decline of the ultimate American tradition — the television itself. According to Nielsen, the number of homes in the U.S. with TV sets is falling for the first time in 20 years. For now, most people are expanding platforms, rather than replacing one for another. But Nielsen notes that “a small subset of younger, urban consumers are going without paid TV subscriptions.”

“Long-term effects of this are unclear,” concluded the Nielsen press release. This younger subset could turn to television as they get older and acquire more financial means, or it could mean “the beginning of a larger shift to viewing online and on mobile devices.” 

Are you considering cutting ties with your digital, cable or satellite TV? Let us know in the comments below.