May 25, 2017 - Economy & Business

Cord-cutting explodes

Cord-cutters are ditching their cable packages at the fastest rate ever, opting instead for cheaper, bundled digital TV options, according to the latest Magid Broadcast Study.

Data: Magid Proprietary Insights, April 2017; Chart: Andrew Witherspoon / Axios

Why it matters: The trend reflects consumers' preferences to ditch bundled cable packages for more affordable, niche bundled services that can be accessed on TV box tops or on mobile. For consumers, there are more bundled packages than ever, all popping up around similar price ranges. YouTube TV and Hulu TV launched within the past two month, joining the likes of SlingTV and DirectTV Now — all at a roughly $40 monthly price point — a bargain considering the average American pays $92 monthly for cable.

Cord-cutting is being matched by a rise in streaming, also at a rate faster than ever. Per the Interactive Advertising Bureau's latest TV industry study, 56% of U.S. adults own a streaming-enabled television, up from one-third of adults in 2015.

"Skinny" is the new trend: Most major content providers are transitioning to "skinny" bundles, smaller channel packages that combine only a few highly-desired channels. Earlier this year, Apple announced it would offer a "skinny bundle" of HBO, Showtime and Starz. Dish is now offering a skinny "flex pack," and last year Verizon introduced a 'skinny bundle' at $55 monthly.

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