The Internet has impacted all industries, not the least of which is the television industry. With broadband Internet access becoming commonplace, it’s relatively easy for a consumer to download and watch their favorite movie or TV show on their computer rather than on their television.
If you add in the growing popularity of tablet PCs like Apple’s iPad – which allow consumers to watch video almost anywhere – it would seem that downloadable video content (known in the industry as “Pay to View” content) represents a serious threat to traditional television networks. If a consumer can download their favorite TV shows and watch them on their iPad, why do they need to pay for cable TV?
A recent JD Power study tried to answer this very question by surveying consumers in about 7,000 households in the USA. While the study concluded that the number of “cord cutters” (people who reject cable TV subscriptions in lieu of downloadable content) is small, the study also highlighted the importance of cable habits for Baby Boomers to the cable industry.
According to JD Power, Baby Boomers are three to four times less likely to replace their cable TV subscription with TV delivered via the Internet. This makes them a much more stable demographic than Generation X and the “Echo Boomers” (also known as Generation Y or the “Millenials”), which seemed far more likely to reject cable in favor of Pay To View content at some point in 2013 or 2014.
Boomers have money to spend on cable TV
In addition to the fact that Baby Boomers are more likely to keep their cable subscription rather than download TV shows, there’s also the fact that:
- Baby Boomers have a significant amount of discretionary income, and
- Boomers place a high priority on cable TV, even during a major recession.
According to Baby Boomer Magazine, boomers have more discretionary income than any other group, and they control about 70% of the wealth in America. Perhaps as a result of this relatively strong economic position, Boomers surveyed by Focalyst at the start of the recession in 2008 had “no intention” of cutting their cable TV subscriptions to save money.
Based on these facts, it’s no surprise that Cable TV operators are beginning to offer content specifically targeting Boomers and the known cable habits for Baby Boomers. A new TV network called “Redefine Life TV” targets viewers who are 50 and over with television shows designed to appeal to the needs of Boomers, such as “Making Medicare Work for You,” which offers advice on using Medicare, and “Another Chance at Romance,” which profiles Boomers in the dating scene.
Based on the data, Boomers would seem to be one of Cable TV’s most important demographics.
This is a guest post by Allison Murray on behalf of market research company, Scarborough Research. Scarborough measures the lifestyles, shopping patterns, television statistics, media behaviors, and national demographics of Americans.