Cutbacks in home communications and entertainment services have yet to emerge as a measurable trend, despite the ongoing recession, say researchers at Pike & Fischer, who recently polled 600 consumers nationwide about their spending on phone, Internet and multichannel video.
Scott Sleek, Pike & Fischer director of broadband advisory services, says the firm conducted the survey because it has been hearing so much "doom and gloom" from service provider executives.
But the study indicates respondents say they would rather keep Internet, video and voice services in their budgets than any other type of expense, including gym memberships, personal care products and apparel.
But the results also point to customers becoming more aware of ways to spend less on those services. That suggests average revenue per user is, or will soon become, an issue for service providers.
"We found very consistent consumer behavior," says Sleek. "We found no evidence of downgrading, for example."
"What I found interesting was that when we asked what people planned to do with their phone and TV services, most said they were planning absolutely no changes," says Sleek.
"Of course, neither are they upgrading, buying more premium channels or adding faster Internet tiers, either," he notes. That is "better than a lot of people thought would happen," he adds.
But one reason service provider executives remain nervous is that there are so many free and cheaper services available now that didn't exist five years ago. Nobody was sure what would happen, this time around.
So far, though, behavior is what one would have predicted, based on behavior in past recessions: stability of subscriptions, but some pressure on average revenue per user.
"The cable guys are worried about over the top video, but so far, it seems to be augmenting video consumption," says Sleek.
People report spending more time at home, so TV and Internet arguably are more valuable.
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