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It Sucks to Be The Cord These Days

The "cord" is being abused on many fronts these days. If it's not being "shaved," "thinned" or "frayed," it's being "cut."

And, not to pile on, but it's apparently dealing with wanton infidelity too.

Digitalsmiths, a company that makes video personalization and discovery software, highlighted the term “cord-cheating” in a Q2 Video Trends Report released this week that compiled results from a survey with of 1,850 consumers in the U.S. and Canada.

Cord-cheating, labeled by Digitalsmiths as “the new beast,” refers to a trend in which consumers are going to third-party, over-the-top suppliers of VOD services – Netflix, Redbox, Vudu, Hulu Plus, Amazon, et al. – as an alternative to the pay-TV operator’s VOD offerings, including authenticated TV Everywhere apps.

“Despite the investments in on-demand infrastructure, Pay-TV providers are being cheated out of additional revenue possibly due to the quality of the user experience provided by these third-party services,” Digitalsmiths said in its analysis, which wondered how long consumers will pay for and use both services.

Some survey results that highlighted this trend:

  • 68% of smartphone and tablet owners said they have not downloaded their pay-TV provider’s app.
  • 35% have a subscription to an OTT service.
  • 22.1% regularly use a third-party “pay-per-rental” service (I guess that’s replacing the antiquated term, “pay-per-view”).
  • 73.8% never purchase from their pay-TV provider’s VOD catalog.

Of course, Digitalsmiths believes that it can help pay-TV providers do something about this mutating threat by freshening up the user interface, adding personalization and recommendation features, and spending more effort promoting TVE services.

Any pay-TV provider worth its salt is painfully aware of this, and is introducing or is getting ready to introduce such features not just to set-tops but to their TVE apps, while also spending more effort pushing the TVE option. Cox, for example, has introduced personal profiles to its set-top UI and a new iPad app, and personalization will be a major feature in Comcast’s coming multiscreen X2 platform. Promos such as Comcast’s Watchathon Week have helped to boost VOD and TVE usage and awareness.

But the survey results do amplify the seriousness of this trend. The number of people surveyed who have never purchased a VOD title from their pay-TV provider was surprising to me.

Not that I'm a direct reflection of those findings, but I do use Netflix a lot more than I use my provider’s VOD service and TVE offerings (mostly for binge viewing of a TV series), and have on occasion tapped into Vudu, a service that offers some nice value with its support for Ultraviolet. Cable VOD has lots and lots to offer, but I’ve just grown more comfortable using OTT options. It just feels more convenient.

Pay-TV providers are trying to answer the bell here, but they are fighting from behind when it comes to VOD friendliness and usability. And they’ll have to throw a lot of punches to catch up as they not only introduce  new features, but spend time, money and effort educating customers and working toward altering those  usage habits.