Press release

Streaming TV Viewers in the U.S. Could Surpass Traditional Pay TV Viewers in Five Years

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Roku, Inc. (NASDAQ: ROKU) today released a 2019 Cord Cutting study that predicts approximately 60 million TV households are expected to access video on their TV exclusively through streaming within the next five years. If this happens, for the first time, streamers will surpass traditional Pay TV viewers.

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Roku issues 2019 Cord Cutting study. (Photo: Business Wire)

Roku issues 2019 Cord Cutting study. (Photo: Business Wire)

Overall U.S. market data suggests two million Americans have ‘cut the cord’ so far in 2019, moving from traditional Pay TV (cable or satellite television subscriptions). That’s after 3.5 million people gave up traditional Pay TV video subscriptions in 2018. Consumers who are already streaming include Cord Cutters, TV households that previously had Pay TV; Cord Shavers who may pay for traditional cable but have reduced their package in the last few years; and Cord Nevers, those who have never had Pay TV.

New findings from the 2019 Roku Cord Cutter study and analysis of behavioral usage on the Roku® platform show that a new generation of Cord Cutters has emerged. Analysis indicates shifts in attitudes, behaviors and, most importantly, viewership among the new generation of Cord Cutters. Essentially, their viewing behavior more closely mirrors that of average mainstream TV viewers, but this new generation of Cord Cutters took the initiative to seek out better value and choice in how they consume TV.

Factors Driving the Move to Streaming

The Roku Cord Cutting study points to five factors that are driving the acceleration of cord cutting including:

  • Virtual multichannel video programming distributors (vMVPDs) offer a bridge for consumers who want to cut the cord but don’t want to miss out on network and live TV programming that traditional Pay TV services offer. When consumers become aware that they can stream the same live local channels, including sports, news, reality, and top network channels with an electronic programming guide (EPG) and video on demand (VOD) at a reduced price, some of their barriers to cord cutting are removed.
  • An abundance of high-quality content is available through streaming. Companies who offer subscription video on demand services (SVOD) are spending billions on creating and promoting award-winning original content.
  • Viewers are finding value in the ability to watch ad-supported video on demand (AVOD). In fact, 73 percent of all video streamers in the Roku study watch AVOD and 45 percent watch more free TV than any other streaming video option. Many Cord Cutters don’t mind viewing video ads in exchange for viewing free entertainment. In contrast, many traditional linear TV viewers reported in the study that there are too many ads within the content they watch.
  • Of those surveyed for the Roku study, 74 percent say streaming is more convenient than Pay TV services and 89 percent report that using a streaming device is very easy.
  • Increasingly, cable and satellite companies are devoting less effort to trying to retain low-margin video subscribers.

Roku Customers Rank the Highest for Satisfaction Among Cord Cutters

Roku’s analysis of the Cord Cutting study shows that 82 percent of all Cord Cutters who participated in the study are extremely satisfied with their decision to cut the cord while 92 percent of Roku customers shared the same sentiment.

“This report shows there is a huge, new generation of streamers who enjoy live and free TV and are extremely satisfied with the decision to watch TV without cable or satellite,” said Matthew Anderson, Roku chief marketing officer. “Half of Roku’s U.S. customers don’t have traditional cable and satellite subscriptions and they enjoy the value, ease and breadth of content we offer them. The Roku study shows that the shift to streaming is more popular and growing faster than ever before.”

The Roku Cord Cutting Study

Roku conducted its second annual comprehensive study on the TV household landscape with participation from 7,000 U.S. adults age 18 and over, and 12,000 Roku account-holding U.S. adults age 18 and over.

The full study titled “The New Generation of Cord Cutters” can be viewed at: https://advertising.roku.com/download-cord-cutting-is-now-mainstream

About Roku, Inc.

Roku pioneered streaming to the TV. We connect users to the streaming content they love, enable content publishers to build and monetize large audiences, and provide advertisers with unique capabilities to engage consumers. Roku TV™ models and Roku streaming players are available around the world through direct retail sales and licensing arrangements with TV OEMs and service operators. Roku audio products are available in the U.S. through direct retail sales. Roku is headquartered in Los Gatos, Calif. U.S.A.

This press release contains “forward-looking” statements that are based on our beliefs and assumptions and on information currently available to us on the date of this press release. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. These statements include but are not limited to the number of households that are expected to access video through streaming in the next five years and when the number of households streaming TV will surpass traditional Pay TV viewers. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. Important factors that could cause our actual results to differ materially are detailed from time to time in the reports Roku, Inc. files with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2018 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2019. Copies of reports filed with the SEC are posted on Roku’s website and are available from Roku without charge.

Roku is a registered trademark and Roku TV is a trademark of Roku, Inc. in the U.S. and in other countries.