Cable and satellite companies losing viewers

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Remember how baffled you were as a child growing up in the ’90s when you discovered a fellow grade school classmate didn’t have basic cable on his or her television set? Now, it’s the cable companies who are baffled at their potentially becoming a thing of the past.

The Convergence Consulting Group Ltd., a technology consulting company, recently released a report stating that more than 800,000 U.S. households have canceled their cable or satellite service in the last two years — most in favor of watching television on the Internet. By the end of 2011, the number of cord cutters, or people who have canceled their cable or satellite service, is expected to skyrocket to 1.6 million households.

The cable industry, however, still dominates. According to an April 13 blog post on Techcrunch.com, there are more than 100 million television access subscribers in the U.S., which adds up to $84 billion dollars in revenue for the cable and satellite industries.

CCG’s report contained information which could worry some television executives. Cord cutters make up only 3 percent of online TV watching, meaning there is a large market of cable subscribers who are already watching their favorite TV shows on the Internet, and could cut their cable cord at any time.

There are numerous reasons for the rise of Internet television.

Erik Ugland, an assistant professor in the College of Communication, said the new, highly advanced computers and monitors in American households are now almost as clear as the picture quality on some HDTVs.

The main factor in households canceling their cable service is cost, Ugland said.

“Most people with HDTVs are going to get better picture quality and a better overall viewing experience by watching shows in their homes via cable or satellite,” Ugland said. “But for most programs, the quality drop-off is less important than the cost and convenience factors.”

He added that a lot more people are illegally downloading content, and that can unnerve producers. But the most significant factor in the drop-off is people deciding to give up their cable subscription, he said.

Ugland also cited portability as a factor in a cord cutter’s decision. Consumers can access Web content anywhere using devices such as iPhones or iPads.

“People don’t like to be tethered to their televisions,” Ugland said.

Students studying abroad have found the Internet highly useful in keeping up with their favorite American TV shows.

Jacob Bear, a sophomore in the College of Business Administration who is currently studying in Rome, said he uses “sketchy” sites several times per week to watch American movies and TV shows.

“These sites provide TV shows for free at a reasonable picture quality, so it’s really my only option,” Bear said in an e-mail.

Others still prefer watching television in a more conventional way. Torsten Nieminen, a sophomore in the College of Business Administration, said he almost never uses the Internet to watch TV.

“It’s just convenient to sit back and surf through the channels as opposed to having to find a specific show and wait for it to download,” Nieminen said.

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