SEATTLE—The ongoing shift in consumer spending towards streaming services has slightly cut U.S. consumer spending on cable and internet spending, according to a new report from doxo (opens in new tab),
Despite inflation in the overall economy, doxo’s new U.S. Cable & Internet Market Size and Household Spending Report for 2022, reveals Americans spend $146 billion annually on cable and internet bills, with 82% of U.S. households paying cable and Internet bills that cost $114 per month, or $1,368 per year on average. That amounts to $1,122 per year when averaging across all U.S. households.
These figures are slightly down from the 2021 analysis of the $147 billion Cable & Internet market (opens in new tab) that found consumers paid $116 per month on average.
This relatively flat spending stands in stark contrast to the surge of consumer spending on streaming services and mobile content, the researchers said.
As the availability of over-the-top (OTT) platforms continues to explode, consumers continue to cut the cord, opting for streaming services to consume content, with 93% of consumers planning to increase their streaming options (opens in new tab) (or make no changes to their existing plans), doxo reported.
“Consumer consumption of streaming content has never been higher, thanks in large part to the over-the-top (OTT) platforms and content providing more choice and increased consumer appetite and consumption,” said Jim Kreyenhagen, vice president of marketing and consumer services at doxo. “While our recent doxoINSIGHTS United States of Bill Pay report showed an increase in consumer spending across nearly every other category in line with overall rate of inflation, cable and internet spending has not kept pace. While the decline in consumer spending isn’t a complete surprise given the intense competition from OTT content, what’s a little surprising is that it is one of the only bill categories not affected by the current inflation rate.”
Notwithstanding the slowing growth, the increase in people working from home and distance learning in the pandemic has stressed household finances.
The FCC’s Emergency Broadband Benefit (opens in new tab) was launched to subsidize increased cable and internet use and corresponding bills. The Biden Administration has since extended this subsidy via the Affordable Connectivity Program (opens in new tab), a $14 billion dollar program aimed at alleviating this hardship, with up to $30 per month toward internet service for eligible households (and up to $75 per month for households on qualifying Tribal lands), and a one-time discount of up to $100 to purchase a laptop, desktop computer, or tablet from participating providers if they contribute a set amount toward the purchase price.
Given the average US household spends $1,122 per year on cable and internet service, this assistance of up to $360 per year for each qualifying household to offset cable, adds up to a 32% savings for the average household cable.
Overall the report found:
- Total Cable & Internet Market Size: $146 billion spent per year
- Average Monthly/Annual Cost: $114 spent per month; $1,368 spent per year
- Percent of Households: 82% of U.S. households pay Cable & Internet bills
- Average Annual Cost per U.S. Household: $1,122 per year
- Percent of Annual Income: Cable & Internet bills amount to 2% of consumers’ income per year