Are Millennials Cutting the Cord?

Cable: Will They Or Won’t They?

Cable is the dominant mode of TV delivery for all age groups, but nearly a fifth of younger adults don’t subscribe and are content to connect their TV to the Internet or use antennas for broadcast. As they age, will they eventually accept cable?

Dropping Cable (After They Move Out)

Cable is a tougher sell to millennials. Many do without it once they live in their own homes. Millennial households without children are the least likely to have cable — one quarter use the Internet or antennas instead.

Could millennials end up connecting the cord after all?

The decision to go without a traditional cable or satellite service and rely exclusively on Internet streaming video might last only until millennials start families, new Nielsen research on the media habits of the 18-to-34 age group suggests.

Millennials, more than a fifth of the total American TV audience of about 292 million adults and children, are considered crucial to the future of television because marketers covet their high earning potential and receptivity to ads. Yet with much of media in flux, their viewing habits continue to confound researchers, although the new numbers offer some clarity.

Nielsen analyzed members of the group by segregating them by life situations: millennials living in their parents’ or someone else’s home, those living on their own without children and those living on their own with children.

Since there are roughly two and half times as many millennials in the first two groups as in the group with children, many more millennials can be expected to eventually start families. And Nielsen found that millennials who had done so were more likely to subscribe to a pay-TV service than their peers without children.

“We think behaviors could change once the so-called millennials start having families,” said Glenn B. Enoch, senior vice president for audience insights at Nielsen. New parents’ desire for better programming for their children will help drive them to cable, media executives have predicted.

About 80 percent of millennials with their own homes who have started families subscribe to cable, and an additional 14 percent get television with an antenna, according to Nielsen. Only 6 percent have just broadband connected to a television set.

Among childless millennials who live in their own homes, about 75 percent subscribe to cable television, while 13 percent live in so-called broadband-only homes.

The numbers skew by income and geography. Among millennials with children, lower adoption of broadband and streaming video services correlates with lower income and living in smaller towns or rural areas, where digital services may not be optimal.

In contrast, childless millennials living on their own tend to have gone to college, live in urban areas and hold white-collar jobs with higher pay; they can better afford to pay for premium Internet service, which is more readily available.

In any case, cord-cutting accelerated during the second quarter this year, industry analysts say. So it is still unclear whether digitally astute millennials who want to have children will find it necessary to subscribe to a traditional service, particularly as the number of streaming alternatives explodes. Outlets like Netflix and Amazon are pouring resources into acquiring and developing exclusive children’s series, knowing that can lure parents to subscribe.

About the only thing that can be said for certain about this pivotal audience segment is that millennials are watching television in new and different ways. The numbers presented here help fill out the picture.