Cord Cutters Growing in Canada, Thanks to Alternative Video Services: Report

According to the J.D. Power 2017 Canadian Television/Internet Provider Customer Satisfaction Study released today, more than 1 in 4 subscribers in Canada are considering cutting their TV cords as alternative video services continue to grow, with Netflix being the most popular platform.

“While our data does not signify a mass exodus over the short term, TV subscribers are increasingly experimenting with —and liking—alternative streaming video options,” said Adrian Chung, director at J.D. Power. The latest studies found that a total of 27% of subscribers are either unsure or plan to drop their pay TV service within the next 12 months, while 73% say they plan to keep their television service.

“The biggest concern for the cable industry should be the highly favorable customer satisfaction scores that alternative video services are receiving relative to traditional pay TV.  The availability of faster network speeds stands to further fuel this shift in viewing preferences.”

The following are some key findings of the 2017 study:

• Alternative video service adoption rising: More than half (53%) of pay TV subscribers have used an alternative video service in the past year, up from 49% in 2016 and 42% in 2015. Among customers who’ve tried alternative video services, Netflix is by far the most widely used platform (73%).
• Satisfaction higher for alternatives than traditional: Customers rate their alternative video service higher than their traditional pay TV service for overall experience (7.58 vs. 7.04 on a 10-point scale). This is driven primarily by higher ratings for overall cost (7.84 vs. 5.97).
• Faster, faster, faster: Satisfaction with internet service providers is highest when customers have download speeds of 500 Mbps or higher. Satisfaction levels decline in lock-step with declining internet speeds.
• Usability is key: When asked to rate alternative video services on a scale of 1-10 for ease of use, customers gave Netflix a rating of 8.11 vs. the average of 7.91.

The studies, which were fielded in September-October 2016 and March-April 2017, are based on responses from 9,308 TV customers and 9,207 internet customers in Canada.

As for the rankings of providers? In the East region, Videotron was the top for both TV and Internet satisfaction, for the fifth year in a row. Shaw and Cogeco ranked second and third for TV, while Cogeco and Eastlink took second and third for Internet service. Bell and Rogers were below the East average.

In the West region, SaskTel topped TV and Internet satisfaction for the fifth year in a row. Telus was second in TV and MTS third. For Internet, Telus ranked second.