More U.S. homes expected to drop pay-TV services

The number of U.S. households dropping or choosing not to sign up for traditional cable or satellite TV service will rise 5 percent to 1.32 million this year, fueling changes in the way television is delivered and watched.

The non-pay-TV households are comprised of consumers canceling subscriptions and new residents who forgo service, said Brahm Eiley, a media analyst with Convergence Consulting Group Ltd. The number has increased from 650,000 estimated by Toronto-based Convergence in 2013.

The decline in pay-TV subscribers reflects the popularity of online subscription video services such as Netflix Inc., which will add 4.9 million new streaming subscribers in the U.S. this year. Time Warner Inc.’s HBO has started a Web-streaming service and others such as Amazon.com Inc. also produce shows directly for the Web. The changing viewing habits also illustrate the cost of pay-TV service, which averages $84 a month, versus $43 for high-speed Internet access.

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Bloomberg News