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“Cord Cutters” turning to online video and OTA antennas

At first cable executives denied the trend, blaming it only on an economic hiccup. But that excuse no longer works as millions of Americans are cutting the cord and moving to the Internet and free over-the-air (OTA) reception.

So far about six percent of U.S. households have cut the cord, and close to sixty million Americans now get their TV for free off antennas. Millions more have completely dropped cable and satellite TV in favor of streaming-only fare over the Internet.

A new study released last week by GfK, a market research firm, found that 19.3 percent of all U.S. TV households get their TV from free OTA broadcasts. This means that 22.4 million households representing 59.7 million Americans get their TV for free, the market research firm estimated. One in five young households never bothered to get a TV subscription to begin with.

The number of households relying on OTA reception only is also growing, GigaOm reported. In 2010, it reported that only 14 percent of all households were getting their TV this way. Growth is especially strong amongst younger households, lower-income families and minorities, and it’s gathering momentum quickly, GigaOM said.

It’s not hard to see why people are looking for ways to ditch their cable bill, USA Today reported. A recent study by the NPD Group determined that the average monthly cost of pay TV in the U.S. hit $86 in 2011 and is projected to rise to $123 by 2015. That’s on top of broadband Internet access, which can chew up anywhere from $20 to $205 per month, when it isn’t bundled with a cable subscription.

In contrast, Netflix and Hulu Plus cost just $7.99 monthly, the newspaper reported. Amazon’s video service is bundled into its Prime membership, which runs $79 per year. Add the three together and you’re looking at about $22.50 for monthly access to a massive combined catalog of movies and TV shows. And these are just the most prominent out of dozens of competing streaming services.

Nielsen, the television measurement company, has begun to pay special attention to what it calls “Zero-TV” households. Though it still refers to them as a “small group,” Nielsen said that these cord-cutters now account for more than five million homes, up from just over two million in 2007.

The GfK study found that minorities represent 41 percent of all antenna households. The majority of Latino households that speak primarily Spanish now use an antenna to get their TV programming, with only 49 percent of those households subscribing to a pay-TV service, GfK said. Also, 28 percent of all households with a head of household under the age of 35 use an antenna instead of a pay-TV subscription.