Last year, cable and satellite television companies in the United States lost 800,000 subscribers to services like Netflix, iTunes and over the air broadcasts, according to a consulting firm.
Convergence Consulting Group says that number will double to 1.6 million "cord cutters" in 2010, though I can't tell how the group came upon this figure.
In any case, it's way too early to count out cable and satellite. The same study estimates that paid TV subscriptions rose by 2 million last year. The growth rate will reportedly slow over the next few years, to 1.8 million subscribers in 2010 and 1.65 million in 2011. But that still means it'll probably be another couple years before Web TV grows faster than cable, and much longer before paid TV subscriptions fall in favor of the Web.
Web TV also has some forces working against it. DVR is on the rise, with the group is estimating 35 percent penetration by the end of 2009, and 50 percent in 2012. "Given the option of watching TV and skipping ads, or watching TV online with ads, we believe the majority of consumers will choose TV and the DVR," Convergence says.
Adoption of high definition subscriptions will follow the same growth pattern, with 36 percent of paid TV subscribers estimated to be getting HD in 2009, and 58 percent by the end of 2012. In my experience, streaming video simply does not match the quality of an HD broadcast, especially for high frame rate live broadcasts such as sports and late night variety shows.
Nonetheless, I am among the cord cutters. As TechCrunch's Erick Schonfeld points out, it's often a matter of convenience versus cost. In my apartment, the $50 per month cost of pay TV is better saved, as I don't watch $50 worth of TV when I've got more than enough video games to play, Netflix movies and TV shows to watch, Hulu videos to stream and iPad content to read and play with.
