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Wireless carriers may keep you from dropping cable TV

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Yet another study about cord cutting—the fine art of firing your cable or satellite-TV service—offers useful reminders for the online streaming services that have taken an increasing chunk of the video market from traditional pay-TV services.

The State of Online Video 2018, from Limelight Networks (LLNW), a content-distribution firm in Tempe, Ariz., finds that cable subscribers pay for more streaming video services than non-cable subscribers. That’s good news for cable companies since it means the growth of streaming services might not mean the end for cable and satellite TV.

The study, however, also found that while we’re watching more video online, we’re also less willing to tolerate price hikes among streaming services and interrupted playback. That could be bad news for the streaming providers like Netflix and Hulu, especially when their services are increasingly tied to the Big Four wireless carriers’ below-average network performance.  

How much we watch, and on what devices

Limelight’s new study—based, it says, on responses from 5,000 18-and-up regular online video viewers in France, Germany, India, Italy, Japan, Philippines, Singapore, South Korea, the United Kingdom, and the United States—leads with a big increase in time spent watching online videos.

Across all those countries, people watch 6 hours and 45 minutes of online video a week, an hour more than in the 2017 edition of this report. The U.S. increase, however, easily exceeded that: We now watch 8:23 of online video a week—well above the 6:35 figure of 2017, and not far behind the 10:20 number for broadcast, cable and satellite.

Limelight data not published in the post showed that 74.6% of U.S. viewers still subscribed to cable or satellite, a lower rate than in surveys that haven’t focused on regular streaming viewers.

Respondents in the U.S. said they were most likely to watch online video on a smartphone, followed by a computer and then either a smart TV or streaming player. In that last category of devices plugged into a TV or monitor,  Amazon (AMZN) and Roku (ROKU) remain the top two brands, accounting for 22 and 21% of that market.

Sports stalling and buffer rage

Limelight’s study also calls out some risks to streaming services. In nine of the 10 nations surveyed, price hikes were the primary reason people cited for dropping an online video app. In the U.S., 62% of respondents cited that gripe.

This study called out another possible holdup for online video: sports streaming that lags just far enough behind the live action to leave fans vulnerable to seeing spoilers in social media about a game they’re watching online.

U.S. viewers weren’t too bent out of shape over this possibility—only 53.4% said they’d be more likely to watch lives sports streaming if it had no lag between pay TV. But over the 10 countries surveyed, this preference was most pronounced among viewers aged 26 to 35: a full 67% wanted to see that delay eliminated from sports streaming.

(The study didn’t ask about regional blackouts of local teams’ games, a lingering gripe among American cord cutters.)

Unfortunately for streaming services, playback lag and overall quality depends heavily on the internet providers their viewers use. And the Limelight study found that they’re increasingly intolerant of rebuffering and other interruptions: 66% would stop watching a video if it rebuffered twice, compared to 61% a year ago.

What’s vexing about mobile video

A separate study out Tuesday from OpenSignal offers additional context on that angle. That London-based firm’s first report on the state of mobile video—graded from 0 to 100, factoring in “picture quality, video loading time and stall rate,” as gathered by its crowdsourced network-testing apps—finds that U.S. viewers have it worse off than most of the rest of the world.

With an overall score of 46.84, the States took 59th place out of 69 countries, landing between Chile and Malaysia. The Czech Republic took the top score, with 68.52, while the Philippines occupied the lowest ranking at 34.98.

This was not a factor of poor speeds among U.S. carriers, although OpenSignal’s data has previously found U.S. wireless service wanting. Average download speeds of 16.53 Mbps left the U.S. ranking much higher relative to the rest of the world.

But as the OpenSignal report relates, “once a country passes the 15 Mbps threshold in average overall download speed, the raw power of connections has little bearing on streaming video quality.”

And in the U.S., AT&T (T), Sprint (S), T-Mobile (TMUS) and Verizon (VZ), the parent firm of Yahoo Finance, have all limited the resolution of streaming video on their cheaper unlimited-data plans. OpenSignal’s report warns that a widespread lifting of those caps could make things worse for U.S. viewers.

The best way to avoid that problem is to stick with wired internet service. Yes, that means that if you want to fire Comcast (CMCSA) as your TV provider, you’ll have to keep it as your internet provider. If it helps, we’re pretty sure that dropping old-school pay TV will still save money over the long run.

More from Rob:

Email Rob at rob@robpegoraro.com; follow him on Twitter at @robpegoraro.

 





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