20% of Consumers Likely to Move to Netflix, Hulu in 2016

According to a new survey done by accounting firm PwC called "Videoquake 3.0: The Evolution of TV's Revolution," one out of five US consumers are likely to give up their cable TV subscriptions. This is from the growth of online services like Netflix.

It seems that pay TV is losing popularity with the American consumer. The survey asked consumers if they would subscribe to a pay-TV service in 2014 with the favorable response of 91%, but that dropped to 79% in 2015. This implies that one-fifth of consumers would cancel their cable subscriptions in the upcoming year.

As VentureBeat reported, "PwC found that 79 percent of U.S. consumers subscribe to some form of traditional pay TV. Of those who subscribe, 23 percent said they engaged in cord-trimming in the past year. Sixteen percent of respondents said they had unsubscribed from pay-TV services in the past year, and 5 percent said they have never subscribed to pay-TV services."

So to summarize, consumers are beginning to want a different business model that allows them to customize their viewing experience. As Multichannel News reported, PwC said in the study, "Consumers' relationship with video content is fundamentally changing - and the shift shows no signs abating."

Younger consumers are also getting that content on more than one type of screen. The study reported that 77% of 18 to 24-year-old were watching TV content over the Internet but on phones, tablets, and other mobile devices.

1,200 consumers were polled for PwC's report on paid TV and OTT. Netflix, Hulu, and Amazon Prime are all examples of what they called over-the-top (OTT) services. OTT are third-party providers that deliver their content over the Internet with a subscription to cable or satellite TV.

These OTT services have allowed customers to reduce their monthly spending by removing pay-TV subscriptions. But there is no one service that commands the consumers' complete attention. Sixty-six percent of Americans subscribe to Netfilx, but 52% of those Netflix users also still subscribe to cable and 55% also subscribing to another OTT service. Amazon Prime users are similar with 53% still subscribing to cable and 79% subscribing to at least one other OTT service.

The results are just as similar according to another survey done by TiVo. Their report, covered by VentureBeat, said that 61.1% of consumers are "categorized as 'cord cheaters', or people who use alternative to traditional pay-TV services." About 19 percent had cut their cable TV in the past 12 months.

What these two surveys are saying is the same message to the pay-TV service providers. If you don't change the way you present content, you will lose business.