Comment (12)Despite recent efforts to boost their video and broadband offerings, North American pay-TV providers are far from out of the woods just yet.
In its latest study of the US-Canadian video market (registration required), Digitalsmiths Corp. found that up to 43% of pay TV subscribers are planning to cut or change their cable or satellite TV service over the next six months or are considering such a move. Further, about 20% of cable and satellite TV subscribers said they are unhappy with their current provider.
Digitalsmiths surveyed 3,140 pay-TV customers in the two countries and found that the biggest source of unhappiness remains high monthly subscription bills for multichannel video service. About two-thirds of unsatisfied customers (67%) cited increasing fees for video service, while 37% named increasing fees for Internet service, 34% cited bad channel selection, and 31% cited poor customer service.
In another notable sign of subscriber discontent, nearly three-quarters of pay-TV subscribers (73%) said they don't order pay-per-view or video-on-demand movies from their current provider. Yet 45% are buying similar fare from such increasingly popular over-the-top services as Netflix Inc. (Nasdaq: NFLX) and Hulu LLC .
In one more disturbing sign for US and Canadian pay-TV providers, 36% of subscribers said they know their operator offers TV Everywhere services. Fifty-two percent said they don't know about such offerings, and 11% said the offerings don't exist, even if they do.
On the positive side for pay TV providers, only 11% of current cable and satellite subscribers said they plan to change or cut their service in the next six months. The bulk of potential ex-customers (32% of those surveyed) said they might consider such a change; this indicates they could still be won over if wooed effectively.
Moreover, the survey indicated that one way pay-TV providers could boost customer satisfaction is by offering recommendations for viewing video content. A good portion of viewers feel overwhelmed by the viewing choices available to them; 53% of the respondents said they would like such program recommendations built into their on-screen programming guides. (Not too coincidentally, Digitalsmiths specializes in building such video recommendation engines for service providers.)
Digitsalsmiths conducts these extensive subscriber surveys every quarter. TiVo Inc. (Nasdaq: TIVO) recently acquired the company for $135 million. (See TiVo to Acquire Digitalsmiths and TiVo Racks Up More Big Gains.)
— Alan Breznick, Cable/Video Practice Leader, Light Reading
