There's this idea that young people, who have grown up in a streaming Internet world, aren't getting cable and they never will. We call these people cord nevers and right now they are more of a theory than a scary trend for the cable companies. It makes sense that a younger "Netflix generation" wouldn't feel the need to pay all that money for all those channels they don't want, but there aren't that many cold hard statistics on this demographic to either confirm or deny it since most statistics in the conversation come from cable company subscription numbers. Those numbers allow us to see how many people are cancelling their cable (not too many) but they don't show how many people are never subscribing to cable in the first place leaving us without information on a possibly huge generational shift in media consumption. On the theory that any numbers would be better than no numbers, we decided to gather a bit of our data ourselves: we asked our esteemed 22-34* year-old colleagues at The Atlantic Media Company a simple question: "Do you have cable at home?"
Granted, the survey is not scientific, but it does offer a look at how a group of young urban professionals who work for a dynamic media company are getting their video entertainment. It's nowhere near the country-wide, large scale data we would love to see regarding this trend, but the 75 respondents includes web developers, bloggers, big-time Atlantic writers, and people who work on the business and events side of our operation — all, we would think, highly desirable potential cable customers.
As you can see in the chart to the right, it was a near even split, with subscribing to cable just a bit more popular, than not having it at all. Of the 75 respondents, 43 pay up for a cable subscription and 32 of them get their TV elsewhere. Now, some might see these numbers and say: "Whoa! look at all those young people who have cable, even though they know all about watching television on the Internet." That was the reaction of The Atlantic's Derek Thompson, who was part of the survey and has also written quite a bit about the future of television. "We're supposed to be the cord never generation and half of us have cable. We know how to get around it, we live in cities with sports bars, we know about Netflix and Hulu," he told me. But when compared to overall household cable penetration rate, which as of last December were at the 83.2 percent mark, the young people we work with are drastically lower than the national average.
These numbers are also startling when put in context of the cord-cutters. Many people suggest that cord cutting isn't happening because cable subscription rates haven't seen a huge drop-off. But the numbers have remained flat for the last couple of years. These young people are forming the new households that should keep the cable a growing industry. Yet many more than the average 16.8 percent are opting out and the question for the cable companies is whether they will ever opt in. Some of our cord nevers told us cost was a factor and maybe they will get cable once they have more disposable income. But even for households in lower income brackets — even for people that make a lot less than what Atlantic Media pays — cable is in a lot more than the 57 percent of homes that we saw. This chart from the U.S. Energy Information administration below shows that at the lowest end of the income scale — households making less than $15,000 a year — 64 percent have cable.
Sure, just because people don't have cable now, doesn't mean they won't change their mind. As we get older, our preferences and priorities change. "Maybe he was individually satisfied with sports bars and she with Netflix, but as a couple, it makes more sense to watch live sports and TV shows on their new couch, and so they buy cable," Derek wrote at The Atlantic. But we did not find a lot of eager future cable subscribers among the hold-outs we spoke to. Beyond the cost issue, which will (hopefully!) be less of an issue once we stop making so little money, one day, The Atlantic's associate editor Heather Horn said, "It's too much of a time-suck. There's something soul-destroying about channel surfing." And what National Journal's White House reporter Sophie Quinton told us should really scare the cable companies: "Hulu/Netflix etc. suit my TV needs just fine."
As the Internet television watching landscape grows, people familiar with it — these young people — will see less of a reason to stick with cable. Even the ones who pay for the old-school package now get how the Internet works, with some of them are already itching to ditch. "I have cable thanks to roommates, but if it were up to me I'd watch the internet for cheap like any other millennial," said The Atlantic's video channel editor Kasia Cieplak-von Baldegg. You hear that: Like any other millennial.
*We decided to choose 34 as the cut-off for "young" not because we think 35 is old, but because 18 to 34 is widely considered in marketing circles as the "most desirable" demographic and that is the number TV ratings powerhouse Neilsen uses in similar surveys for that age group. The youngest employee in our survey was 22.