Netflix Users Are Downgrading their Pay TV Services, Says Report

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A study from The Diffusion Group (TDG) offers more evidence that while cord-cutting is rare, cord-shaving is on the upswing. The study found that the number of Netflix streaming customers likely to downgrade their pay TV subscriptions in the next six months has doubled - from 16 percent to 32 percent - between last year and today.

Trimming their pay TV services means either choosing a less expensive channel package or cutting out premium movie channels.

The motivator, for most, is primarily economic. The study found that close to half of those likely to downgrade their pay TV said they were doing so because of "cost of service" and "the need to save money."

For heavy Netflix users, however, the story is different: 61 percent of them say that the growing use of online video is the reason they'll trim their cable or satellite bills.

"Despite its rhetorical positioning, both Netflix and pay TV operators have long been aware that there will come a point at which its services are not only dilutive to regular TV viewing, but antithetical to pay TV subscription levels," notes Michael Greeson, TDG founding partner and director of research. "The question for realistic observers has been not if this will occur but when. According to our latest research, that time is upon us." 

The study was run in March, 2011. TDG questioned a random sampling of adult broadband users with cable or satellite subscriptions.

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