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cord cutting

Cord cutting, in a telecommunications context, is the practice of stopping a cable or satellite television service or getting rid of a landline phone. In the case of cable and satellite service, most cord cutters drop them in favor of less expensive options, such as Internet TV (ITV). Cord cutters who drop their landline phones usually rely on cellular and/or VoIP (voice over IP) service. The main goal of cord cutting, in both contexts, is saving money. The second most-cited reason for dropping cable or satellite TV is dissatisfaction with offerings or service.

Internet TV options include Web-based TV shows, streaming video services like Netflix and Hulu and content streamed from the websites of regular TV channel websites. Users stream content to their digital televisions or watch on other devices, including smartphones, tablets, laptops and desktop computers. Another alternative to cable and satellite service is free antenna-supported over the air (OTA) broadcasts.

Because most adults own cell phones, many landline customers come to feel that having traditional phone service is a waste of money. Furthermore, VoIP services, such as Skype, offer free international calls between users and also enable video chat, which the traditional phone is not capable of. 

There are drawbacks to cord cutting. Although switching to Internet TV can save money, cable and satellite TV are more convenient to use and may offer content that isn't available online. Similarly, corded landline phones offer some advantages over the other options, such as the ability to continue functioning when the cellular system is overwhelmed, as it may be in a disaster.

Nevertheless, cord cutting in both contexts is increasing. According to Nielsen’s Fourth-Quarter 2012 Cross-Platform Report, the number of Zero-TV homes (a Nielsen category for homes that do not subscribe to cable or satellite service and do not use an antenna) in the United States grew 150% between 2007 and 2012, from two million to five million households. In the context of phone service, the Associated Press recently reported that the number of landline subscribers fell 55% between 2002 and 2012 in New York state.

This was last updated in June 2013

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