US Cable TV Subscribers

Delivered September 10th, 2019. Contributors: Josh T., Erika O., Varun N., Jasleen A. and

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US Cable TV: Average Age

Our research found that the percentages of regular cable TV subscribers has steadily decreased across various age groups in the U.S. between 2014 and 2019. While we weren't able to calculate the average age of a cable TV subscriber in the U.S. for the specified years per reasons explained below, we were able to find the ages of cable TV subscribers for all but one of the requested years. 
Findings2014The following are the percentages of regular cable TV subscribers in 2014 in the U.S. by age group (noted in parentheses): 71% (18-24); 67% (25-34); 64% (35-49); 67% (50-59); and 87% (53+).
2015The following are the percentages of regular cable TV subscribers in 2015 in the U.S. by age group (noted in parentheses): 65% (18-29); 73% (30-49); and 83% (50+).
2016We could not find any applicable data for this year, which is explained in the research methodology section below. 
2017The following are the percentages of regular cable TV subscribers in 2017 in the U.S. by age group (noted in parentheses): 31% (18-29); 52% (30-49); 70% (50-64); and 84% (65+).
2018The following are the percentages of regular cable TV subscribers in 2018 in the U.S. by age group (noted in parentheses): 73% (21-40) and 81% (53+).
2019The following are the percentages of regular cable TV subscribers in 2019 in the U.S. by age group (noted in parentheses): 45% (18-29) and 45% (30-44). 
Your Research Team Applied The Following Strategy:Though we ultimately weren't able to determine the average of cable TV subscribers (explained below), we began our research looking for such data by first finding statistics about such U.S. subscribers by age group. We found that data from a combination of credible sources, which included Statista, Pew Research, USA Today, and Business Insider. The reason we couldn't specifically calculate the average age of the regular cable TV subscriber for each year is because the sources (which were the best ones available, after conducting thorough research) didn't state the number of survey respondents per age group included as part of those surveys. Rather, those sources only stated the total number of survey participants, which wasn't applicable for calculating the average ages for purposes of our research. Accordingly, the data presented above was the clearest manner in which we could present the information that we found. We included all the applicable data that we found throughout our research in the "Findings" section above. 

The only year we could not find data regarding the age of cable TV subscribers for was 2016, both in terms of average age and age groups. In fact, despite conducting thorough research, we did not come across any applicable information about regular cable TV subscribers by age in the U.S. for that year. We implemented three different approaches in searching for that information. First, we consulted numerous articles published by a combination of news and industry sources, such as Deloitte and PwC (among many others), to see if any of those articles mentioned cable subscriber data by age group. However, not one of the many articles we reviewed mentioned any such information whatsoever. 

Second, we utilized the database source Statista, as that source had published such data for other years. However, Statista didn't have this data for 2016. As a third strategy, we tried to triangulate the number of subscribers by age group by looking at the numbers/percentages of U.S. consumers that unsubscribed from regular cable TV that year. While some of that data was available, it was not sufficient for us to conduct the triangulated calculations that would have been necessary. After looking for 2016 data in such a wide-ranging scope, we concluded that this information was not available. 

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US Cable TV: Popular Cable TV Dayparts

While cable television viewership numbers for each daypart and specified age group could not be located in the public domain, Nielsen's Total Audience Report for the second quarter of 2018 provides, by time of day, the average amount of time people in age groups 18-34, 3-49, 50-64, and 65+ spend watching live+time-shifted television. Regardless of age group, both television audience reach/size and viewing time increase throughout the day, and both reach their peak in the prime time daypart (i.e., 7 pm/8 pm to 11 pm). 
FINDINGSNielsen's Total Audience Report for the second quarter of 2018 shows, by time of day, how much time adults in various age groups in the United States spend watching live+time-shifted television. Live+time shifted television, as defined by Nielsen, is inclusive of live usage and playback viewing, which is done mostly on a digital video recorder.
Based on this report, prime time remains the live+time-shifted television daypart with the highest average viewing time across age groups. This is not surprising given that prime time is defined as the daypart when the audience is largest and consumer engagement is greatest. 
Among adults aged 18-34, the television daypart with the highest average viewing time is prime time. In this daypart, the time slot with the highest average viewing time is 9 pm to 10 pm. In this time slot, the average viewing time is around 9 minutes and 4 seconds. 
Among adults aged 35-49, the television daypart with the highest average viewing time is prime time. In this daypart, the time slot with the highest average viewing time is 9 pm to 10 pm. In this time slot, the average viewing time is around 18 minutes and 30 seconds. 
Among adults aged 50-64, the television daypart with the highest average viewing time is prime time. In this daypart, the time slot with the highest average viewing time is 9 pm to 10 pm. In this time slot, the average viewing time is around 27 minutes and 31 seconds. 
Among adults aged 65+, the television daypart with the highest average viewing time is prime time. In this daypart, the time slot with the highest average viewing time is 9 pm to 10 pm. In this time slot, the average viewing time is around 32 minutes and 58 seconds. 
These figures can be assumed to be indicative of cable television viewing behavior for the following reasons:
Time-shifted television viewing accounts for only a small portion of live+time-shifted television viewing. In the second quarter of 2018, adults in the country spent an average of 3 hours and 49 minutes watching live television and an average of 32 minutes watching time-shifted television.
Most television households in the United States have "access to cable content whether it's through traditional cable or a virtual multichannel video programming distributor (vMVPD)." Of television households in the country, 77.4% have traditional cable, while 3.4% have vMVPDs.
The television dayparts can be defined as follows:
Early morning - Mon to Fri, 5 am to 9 am.
Daytime - Mon to Fri, 9 am to 4 pm
Early fringe - Mon to Fri, 4 pm to 6 pm
Evening news - Mon to Fri, 6 pm to 7 pm
Prime access - Mon to Fri, 7 pm to 8 pm
Prime time - Mon to Fri, 8 pm to 11 pm or 7 pm to 11 pm
Late news - Mon to Fri, 10 pm to 10:30 pm
Late fringe - Mon to Fri, 11:30 pm to 2 am
Overnight - Mon to Sun, 2 am to 5 am
Weekend - Sat to Sun, 7 am to 8 pm
Weekend sports - Sat to Sun, 12 pm to 6 pm
Kids - Sat, 7 am to 12 pm
Children's - Mon to Fri, 3 pm to 5 pm
Compared to younger adults, older adults in the country are more inclined to watch cable television several times in a day. Compared to 22% of adults aged 18-29 and 34% of adults aged 30-44, 38% of adults aged 45-54, 47% of adults aged 55-64, and 52% of adults aged 65+ watch cable television several times in a day.
The Bureau of Labor Statistics's Beyond the Numbers report and the Interactive Advertising Bureau's Personal Prime Time report show that audience reach gradually increases from early morning to afternoon, rapidly increases in the early evening and evening dayparts, and then rapidly decreases in the late evening. This same behavior can be observed with the average viewing time and the audience size. 
Based on Nielsen's Total Audience Report, this behavior does not appear to vary across age groups. The only thing that significantly differs across age groups is the length of viewing time. Compared to older adults, younger adults spend less time watching live+time-shifted television.
Based on the Personal Prime Time report, audience reach starts at 11% in the early morning and peaks at 64% in the evening. It then drops to 15% in the late evening.
RESEARCH STRATEGYTo find the desired information, we employed three strategies. First, we checked if there are reports or articles that readily provide the information. In searching for sources that analyze cable television viewing by daypart/time of day and age/generation, we paid special attention to companies that regularly monitor, study, measure, or cover the television industry in the United States. Nielsen Media Research, Video Advertising Bureau, Broadcasting & Cable, and Interactive Advertising Bureau were among the companies we especially consulted, as they appear to be the most authoritative sources of data on the television industry. Unfortunately, after an extensive search, we were unable to find the cable viewership numbers for each daypart and specified age group. The closest details we were able to find were the following: (a) the average amount of time people in age groups 18-34, 3-49, 50-64, and 65+ spend watching live+time-shifted television by time of day, (b) the frequency by which people in age groups 18-29, 30-44, 45-54, 55-64, and 65+ watch cable television, (c) the audience reach by daypart, (d) the average audience size by time of day among adults aged 18-49, and (e) the audience reach by time of day.

Second, we attempted to triangulate the cable television daypart with the largest viewership by analyzing the data that is publicly available. Reviewing Nielsen's Total Audience Report, we learned that live television viewing has the lion's share of live+time-shifted television viewing, and that most television households access television content through traditional cable. Given this information, how cable television viewing varies across dayparts and age groups is more or less the same as how live+time-shifted television viewing varies across dayparts and age groups. We noticed that, regardless of age group, the average viewing time increases throughout the day and peaks in the evening or prime time daypart. The only thing that significantly differs across age groups is the length of viewing time. As the following calculations show, compared to older adults, younger adults spend less time watching live+time-shifted television.

 Adults aged 18-34 
9 pm to 10 pm
28 minutes and 53 seconds = 1,733 seconds
(11 mm/33 mm) x 1,733 seconds = 577 seconds = 9 minutes and 37 seconds

 Adults aged 35-49 
9 pm to 10 pm
37 minutes and 54 seconds = 2,274 seconds
(21 mm/43 mm) x 2,274 seconds = 1,110 seconds = 18 minutes and 30 seconds

 Adults aged 50-64 
9 pm to 10 pm
42 minutes and 37 seconds = 2,557 seconds
(31 mm/48 mm) x 2,557 seconds = 1,651 seconds = 27 minutes and 31 seconds

 Adults aged 65+ 
9 pm to 10 pm
44 minutes and 33 seconds = 2,673 seconds
(37 mm/50 mm) x 2,673 seconds = 1,978 seconds = 32 minutes and 58 seconds

The behavior where viewership or viewing time increases throughout the day and peaks in the evening does not appear to be limited to live+time-shifted television. The same behavior can be observed with television viewing in general. Both the reports of the Bureau of Labor Statistics (BLS) and the Interactive Advertising Bureau (IAB) attest to this. 

Third, we attempted to research daypart cable television viewership numbers by generation. We thought we could find more relevant insights by looking into when the different generations watch cable television. To identify the age range for each generation, we referred to Pew Research Center's definitions. According to the Pew Research Center, Generation Z corresponds to ages 7-22, Millennials correspond to ages 23-38, Generation X corresponds to ages 39-54, Boomers correspond to ages 55-73, and the Silent Generation corresponds to ages 74-91. This final strategy, however, did not produce any additional helpful insights. We came across an article published by Gen Z Insights that says 72% of Gen Zers cite evening as the time of day they usually watch video content, but the article does not look credible. 

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US Cable TV: Subscriber Growth

The number of cable TV subscribers will degrow from 91 million in 2018 to 81 million in 2024, though it will decrease at a slower rate than it is currently. Over half (52%) of the cord-cutters in the United States do not miss anything about cable TV. A greater loyalty towards OTT services, reducing cost savings of lean streaming service bundles offered by cable providers, and an increase in the number of OTT services is likely to result in greater subscriber loss in the future.
TREND STATISTICS According to a study by Digital TV Research, the number of pay TV/ cable TV subscribers will fall from 91 million in 2018 to 81 million in 2024. In the same period, the number of "TV households without a pay TV subscription" will increase from 11.34 million to 48.56 million. Oddly, the number of homes without a TV set is also likely to increase from 1.27 million in 2010 to 9.49 million in 2024.
The number of United States traditional pay TV subscribers diminished from 105 million in 2010 to 91 million in 2018. 
Digital TV Research estimated that there were 3.8 million subscribers lost in 2018, and according to its forecasts, 2019 will see 3 million subscribers cut the cord. While the number of cable TV subscribers will degrow over the next five years, the rate of cord-cutting will decrease.
Similarly, while eMarketer expects the number of cord-cutters to increase from 33 million in 2018 to 50.2 million in 2021, it expects the rate of increase in the number of cord-cutters to decrease from 32.8% in 2018 to 11.6% in 2021.
According to Leichtman Research, the largest players in the industry, comprising 95% of the market, lost 2,875,000 subscribers in 2018, as against 1,510,000 in 2017.
The bulk of the losses in 2018 can be attributed to DirecTV and Dish Network. Collectively, they lost 2,360,000 subscribers.
Some other agency estimates for the number of pay TV subscribers lost in 2018: Informitv Multiscreen Index (2.7 million), Variety (3.2 million among the top five players). 
INSIGHTS A joint survey by Harris Poll and Open X found that 52% of 528 cord-cutters surveyed do not miss anything about pay TV. Live events (23%), local/ national news (22%), live sports (19%), learning new products (8%), and live talk shows (7%) were the programs they missed most.
According to Alan Wolk, co-founder of TV[R]EV, "Cord-cutters are part of a small group of early adopters, most of whom don’t watch a lot of TV, and for whom the ability to watch live sports is not an issue". According to him, many of them are likely to have "access to their parents' cable TV passwords for those times they wanted to watch linear TV".
To combat subscriber loss, cable companies are providing "skinny bundles" of streaming services with live TV access for a lower monthly price. However, these bundles are becoming expensive.
With the cost-saving from skinny bundles reducing, a greater loyalty among the youth for OTT services such as Netflix, more OTT services being launched, cable companies will need to work hard to retain subscribers.

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US Cable TV: Market Size

Currently, the revenue generated from U.S. cable TV is $92 billion. The revenue is expected to grow with a compound annual growth rate (CAGR) of 5.14% over the next 5 years to reach approximately $118.23 billion by 2024. Below is an overview of the findings.

REVENUE U.S. CABLE TVThe current revenue (2019) generated from the U.S. cable TV industry is $92 billion. 
The CAGR over the period 2014 - 2019 is 3.1%.
The predicted CAGR through the period 2018-2024 is 4.8%. 
The forecasted market size after 5 years (2024) is estimated to be $118.23 billion [calculated below]
The forecasted CAGR for the period of 2019-2024 is estimated to be 5.14%.  [calculated below]

OTHER INSIGHTSThe traditional audience in the U.S. cable TV industry has declined as the number of cable TV subscriptions fell by 3.0% per year over the past five years. However, emerging online streaming services have provided alternative delivery systems for industry operators and facilitated strong growth. 
In the past 5 years, the cable TV industry in the U.S. has expanded its premium content, achieving strong revenue growth despite a decline in subscriptions. 
Advertising expenditure has increased annually at a rate of 1.9% from 2014-2019, bolstering a key revenue stream for the cable TV industry in the U.S., while an increase in per capita disposable income has boosted consumer spending on premium networks. 

RESEARCH STRATEGYTo analyze the growth in revenue from the U.S. cable TV industry in the next 5 years, we commenced our research by searching for statistics on the industry in various industry reports such as Euromonitor, GrandView Research, IBIS World and many others. An IBIS World report proved useful as it provided the CAGR in the past 5 years and the current market size of the U.S. cable industry. The content of other reports was locked behind a paywall and additional information on the growth in revenue from the industry in the next 5 years could not be found.

Next, we attempted to triangulate the information by scouring through websites, white papers, investor and annual reports, and press releases of major players in the U.S. cable TV industry. We thoroughly scanned all publicly available resources of players such as AT&T, The Walt Disney Company, NBC Universal, and Viacom Inc. to determine their forecasted growth in the next 5 years. The idea was to derive the growth of the U.S. cable TV industry from these individual growth rates. However, this strategy could not be properly executed as the companies mostly threw light on current and past statistics rather than forecasted data.

We then shifted our focus to publications by national associations such as the Broadcast Cable Credit Association (BCCA), the Broadcast Cable Financial Management Association (BCFMA), The Cable Center, and CableLabs, among many others. The idea was to look for any industry-related insights that could be used to extrapolate the future growth. These sources, however, only focused on the prevalence and subscribers in previous years and the current year. We, therefore, looked for subscriber data for the next 5 years but could not find relevant information that helped forecast future growth. 

CALCULATIONS
Due to the limited resources focusing on the state of the cable TV industry in the U.S., we leveraged industry reports that provided global data. From an industry report published by Market Watch, we found that the "U.S. accounts for the highest market value in the Cable TV Industry". We, therefore, assumed that the predicted CAGR for the global cable TV market was the same as predicted CAGR for the U.S. cable TV market. From another report published by Business Wire, we found the CAGR over the forecast period 2018-2024. 

We, therefore, searched for the revenue generated in 2018 by using the CAGR over the period 2014 to 2019 and the current market size. Next, we calculated the revenue for 2024 using the forecasted CAGR of 4.8%. Last, using the current revenue (2019) and the forecasted revenue (2024), we evaluated the growth in next 5 years.

The following calculations were done using the CAGR calculator:

Revenue 2018
Input:
CAGR = 3.1% 
Number of Periods = 1
Final Value = Revenue 2019 = $92 billion 
Output:
Initial Value = Revenue 2018 = $89.24 billion

Revenue 2024
Input:
CAGR = 4.8% 
Number of Periods = 6
Initial Value = Revenue 2018 = $89.24 billion
Output:
Final Value = Revenue 2024 = $118.23 billion

CAGR 2019-2024
Input:
Initial Value = Revenue 2019 = $92 billion 
Final Value = Revenue 2024 = $118.23 billion
Number of Periods = 5
Output:
CAGR (2019-2024) = 5.14%