The cord-cutting movement is still very much alive, but that doesn't necessarily mean consumers are subscribing to more and more streaming services like Netflix or Hulu, from Walt Disney. The average number of subscription video on demand (SVOD) services that U.S. households tap into was -- before COVID-19, anyway -- holding at just under three. Likewise, some households are willing to spend as much as $30 per month on streaming video services, but a wide swath of consumers are staunchly limiting their video subscription budget closer to $20 per month.

End result? More than half of all U.S. homes still enjoy traditional cable, even if they also subscribe to at least one over-the-top streaming service, according to Leichtman Research Group. Access to sports and local news are a key reason consumers continue to pay steepening cable bills. Indeed, these two may be the only reasons TV watchers tolerate their cable company's prices.

In that vein, what if cable companies like Comcast (CMCSA -0.85%) and AT&T (T -0.51%) have overestimated the strength of their hold on their television customers in the new era of streaming?

They probably have.

Woman pointing a TV remote at a choice of streaming channels

Image source: Getty Images.

Consumers think ends, not means

The cable industry may be looking at things all wrong. The remaining 80 million or so cable customers in the U.S. aren't viewing their over-the-top video subscription costs as an expense in addition to their cable service -- consumers don't care how their entertainment is piped in, or who provides it. What they care about most is not spending more than the average $900 per year on any form of pay-TV.

That's the gist of a recent market report from Ampere Analysis, anyway, which took close looks at just how much the average U.S. household spends on video entertainment. As it turns out, cold turkey cord-cutters end up spending about as much as cable subscribers do once they replace their linear cable service with streaming alternatives. That's why Ampere believes the eventual maximum number of streaming services any given household in the U.S. could eventually reach is as high as eight.

That wasn't a misprint. Ampere Analysis concedes U.S. consumers are more likely to buy more streaming services than television watchers anywhere else in the world, and adds that it will take sports to get most households beyond five over-the-top services and completely off linear cable.

Albeit modestly, thing are already moving in this direction.

Slowly but surely

Hardcore sports fans wouldn't be entirely happy with most streaming services right now, as they rarely offer live events without a full-blown virtual/streaming cable subscription. Change is afoot, however.

Comcast's new streaming platform Peacock, for example, plans to air Premier League Soccer matches and next year's rescheduled Olympics. ViacomCBS (NASDAQ: VIA) (PARA -3.24%) offers NFL games through CBS All Access if CBS already owns the rights to air that game through its network broadcast. In April, the NFL and Amazon renewed an agreement that lets Amazon Prime stream Thursday night games that are also carried by Fox Corp.'s (FOXA -0.30%) (FOX -0.48%) Fox Sports. Walt Disney hasn't yet offered cable ESPN sports events through its streaming sports platform ESPN+, but never say never.

Finally, although he didn't give any specifics or a timeframe, AT&T's then-CEO Randall Stephenson commented last year that "NBA, Major League Baseball, NCAA basketball -- those are going to be really, really important elements for HBO Max." He added, "The same with news." It's another one of the potentially eight SVOD services Ampere estimates U.S. consumers could eventually sign up for without necessarily increasing their total pay-TV bill.

Just as disruptive is the growing cooperation of localized TV stations to deliver their video feeds for free via streaming, circumventing cable service providers like Charter Communications or Comcast. Last week, a consortium of more than 200 television stations collectively formed what is called VUit -- pronounced "view it" -- to stream their feeds. Each participant has agreed to contribute some original programming to the cause, which is expected to include sports. A similar platform called Locast recently added Detroit-based stations to its streaming lineup, bringing its total number of covered markets to 23. This programming (for the time being, anyway -- the legality of the approach is still in dispute) includes NFL games aired through these localized network affiliate stations.

In the meantime, the 16 million households that Deloitte says are using aerial television antennas can catch the professional sports events that networks like CBS or NBC air through all their localized stations.

Predict the future, not the present

It's not enough to replace the sum total of sports programming offered by cable -- yet. The big sports leagues and the cable broadcasters still need each other too much for either to strain the relationship.

Live sports broadcasts outside of traditional cable media's distribution web are becoming more feasible, and those waters are being slowly, increasingly tested. It would be naive to believe that if a cheaper, more flexible way of buying and selling sports and news content is possible that it wouldn't eventually become the norm. Consumers will always eventually find the lowest price for the same product, even if they have to piece together their mix of services.