Light Reading
Two new research reports indicate that the US pay-TV industry finally hit the wall last year, as cable sub losses overwhelmed customer gains by telco and satellite TV providers.

Look Out Below: Pay-TV Posts First Yearly Sub Drop

Alan Breznick
3/19/2014
50%
50%

For the first time in its history, pay-TV is looking like a losing proposition, as the US pay-TV industry lost more subscribers than it gained last year.

Two new research reports indicate that American pay-TV providers collectively lost as many as a quarter of a million video customers in 2013 as cable operators continued to shed millions of video subscribers. Although both telco and satellite TV providers continued to score gains last year, for the first time those gains were not enough to wipe out the big cable losses. (See Pay-TV Makes Small Gain in 2012.)

In a report released Wednesday, SNL Kagan found that pay-TV providers lost 251,000 video subscribers, despite posting a modest gain of 40,000 subs in the fourth quarter. The annual decline, which dropped the industry's total customer count to about 100 million subscribers, also came despite a modest rise in household formation, as the number of occupied units reached nearly 115 million by year-end. (See Pay-TV Adds Trailed Housing Growth in 2012.)

As usual, cable operators led the way down. Kagan estimates that US MSOs lost nearly 2 million video subscribers last year, including 388,000 in the fourth quarter alone, as customers either switched to telco or satellite TV providers or cut the video cord entirely. As a result, the cable industry ended the year with 54.4 million video subs, reducing its market share to 54%.

In contrast, the telcos gained about 1.5 million video customers last year, led by strong gains by both AT&T Inc. (NYSE: T)'s U-verse and Verizon Communications Inc. (NYSE: VZ)'s FiOS services. With these gains, the phone players boosted their collective total to about 11 million video customers, earning them an 11% market share.

The nation's two major satellite TV providers struggled much more for growth than the telcos, especially perennial also-ran Dish Network LLC (Nasdaq: DISH), as they focused more on retaining their highest-paying customers. But they still produced an overall gain of 170,000 video subscribers in 2013, thanks to sub increases for DirecTV Group Inc. (NYSE: DTV) and reduced customer churn rates for both operators. As a result, they ended the year with 34.3 million subscribers, giving them a 34% share.

The Kagan results are consistent with the numbers posted by Leichtman Research Group Inc. (LRG) last Friday. In its latest report on the US pay-TV sector, LRG found that the largest 13 pay-TV providers in the nation lost 105,000 video subscribers last year, reversing their gain of 175,000 subs in 2012.

Similar to what Kagan just reported, LRG found that heavy cable losses more than offset satellite and telco TV gains. The report said the top nine US MSOs shed more than 1.7 million video customers in 2013, a worse performance than the 1.4 million customers they lost in 2012. As a result, the nine MSOs ended the year with a total of 49.6 million subscribers, putting them below the 50-million mark for the first time in years.

In contrast, LRG reported that the top two telco TV providers, AT&T and Verizon, collectively added nearly 1.5 video customers in 2013, up from 1.3 million in 2012. The top two satellite TV providers, DirecTV and Dish, added 170,000 video subs, down from 288,000 the year before.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(24)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Page 1 / 3   >   >>
Mitch Wagner
50%
50%
Mitch Wagner,
User Rank: Lightning
3/20/2014 | 7:04:18 PM
Re: How bad is it
Hypothetically, we prefer to watch TV on the big TV in the living room.

Not that we would ever borrow someone's password anyway. Or download pirated content. Because that would be WRONG.
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
3/20/2014 | 2:20:36 PM
Re: Comcast
You are free to think as you like, right or (in this case) wrong.
Jessie Morrow
50%
50%
Jessie Morrow,
User Rank: Lightning
3/20/2014 | 2:10:02 PM
Re: Comcast
@mendyk, I would not continue this argy-bargy if it were not very obvious that you take the opposite view of the Consumer Reports email, as you so well "advocated" here,

 Last I checked, though, access to the Internet and pay TV service is not an inalienable right. It's also not a mandatory obligation to purchase these services. And all of these services are provided by for-profit companies.

Is your gripe with corporate advocacy vs personal advocacy? If I had plagarized CR's email, deleted all mention of CR  and put my name on it rather than Jim Guest's would that have made it more acceptable?
SarahReedy
50%
50%
SarahReedy,
User Rank: Blogger
3/20/2014 | 1:37:54 PM
Re: How bad is it
I am not sure, although most streaming services have the same loophole. I imagine they'll get tighter with authentication in the future.
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
3/20/2014 | 1:28:31 PM
Re: Comcast
Understood, and the editor of this publication knows my position on this. There is no issue with thoughtful exchanges and differences of opinion regarding the effects of telecom industry developments on the consumer market -- there wouldn't be a telecom industry without consumers. I just don't see a point to advocacy posting here. Reprinting emails from Consumer Reports crosses a line for me.
Jessie Morrow
50%
50%
Jessie Morrow,
User Rank: Lightning
3/20/2014 | 1:21:21 PM
Re: Comcast
@mendyk, among the  posts on this subject DOShea brought up the topic of the Comcast/TWC deal, no one seemed to object at the time, the topic was now open & on the table, and I threw my 2 cents in. Granted if this were a presentation before the Supreme Court you might have a point. But this is not the first time consumer issues have appeared here nor will it be the last.
Jessie Morrow
50%
50%
Jessie Morrow,
User Rank: Lightning
3/20/2014 | 1:08:32 PM
Re: How bad is it
Sarah, don't feel badly you are not the only one with thoughts of Content Theft dancing in your head, just recently a relative admitted doing the same. And it's so very obvious so why has HBO left this unfilled loophole?
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
3/20/2014 | 1:06:06 PM
Re: Comcast
It is a consumer issue. But this isn't a consumer-oriented message board. Of course Consumer Reports has an issue with rising cable and Internet access fees, and since we all are consumers of one sort or another, we all have these issues. Last I checked, though, access to the Internet and pay TV service is not an inalienable right. It's also not a mandatory obligation to purchase these services. And all of these services are provided by for-profit companies.
SarahReedy
50%
50%
SarahReedy,
User Rank: Blogger
3/20/2014 | 12:43:27 PM
Re: How bad is it
Not that I would ever do this...but, "borrow" a friend's HBO Go password, and you're all set to watch it on your iPad!
Jessie Morrow
50%
50%
Jessie Morrow,
User Rank: Lightning
3/20/2014 | 12:30:23 PM
Re: Comcast
Apparently Consumer Reports considers this to be a consumer issue as do I. I'd be interested in hearing from you why you think otherwise.
Page 1 / 3   >   >>
Educational Resources
sponsor supplied content
Educational Resources Archive
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Documentaries
Broadband Battles

10|31|14   |   01:39   |   (0) comments


This year's Broadband World Forum featured a number of show floor battles focused on access gear, components and coffee.
Jonestown
Mobile Backhaul: Going to the Dark Side?

10|30|14   |   2:26   |   (1) comment


Heavy Reading's Patrick Donegan shares his view on a dark trend that bubbled up at Light Reading's annual backhaul conference in NYC.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With CEO of SwitchCom

10|30|14   |   4:13   |   (0) comments


SwitchCom, an IT company based in Angola, recommends a variety of Huawei solutions and hardware to their customers in the energy industry.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With Ethiopia's Ministry of Water Irrigation & Energy

10|30|14   |   4:08   |   (0) comments


Gosaye Mengistie of Ethiopia's Ministry of Water Irrigation & Energy discusses the collaboration with Huawei in that country.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview with Dongfang Electronics Corporation

10|30|14   |   5:46   |   (0) comments


Dongfang Electronics Corporation, headquartered in Chengdu, China, is one of China's largest manufacturers of power generators and contractors of power station projects.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview with Zimbabwe's Customers

10|30|14   |   3:31   |   (0) comments


Representatives of Zimbabwe's Ministry of Power and Development discuss the energy needs of their country as well as new areas of improvement due to enhanced ICT capabilities.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With Colbún Chile

10|30|14   |   4:29   |   (0) comments


In Chile, an aging energy infrastructure was in dire need of a modern update. Claudio Valenzuela of Colbún discusses how Huawei's ICT solutions continue to provide crucial information to improve the grid and how an in-country engineer is a cricial asset.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With YuLiao

10|30|14   |   6:27   |   (0) comments


Yu Liao, chairman of the Chinese Association for Renewable Energy in Germany, discusses the role that ICT solutions play in helping to grow renewable energy resources in Germany.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview

10|30|14   |   2:54   |   (0) comments


Sifang has been working with Huawei on several projects. JingTao Wu, Assistant President of Beijing Sifang Automation Co. Ltd., believes that the cooperation with Huawei can facilitate Sifang's process of internationalization.
LRTV Huawei Video Resource Center
A Better Connected Smart Grid: Powering Laos

10|30|14   |   5:38   |   (0) comments


Representatives of Electricite Du Laos (EDL), a state-owned corporation, discuss the importance of ICT solutions in serving their country's energy needs.
LRTV Huawei Video Resource Center
2014 Huawei Electric Power Industry Summit: Interview With Junwei Lu

10|30|14   |   4:50   |   (0) comments


Professor Junwei Lu of Griffith University Australia describes his work with micro grid technology and the future of the power industry.
LRTV Documentaries
The Next-Gen Network Disconnect

10|29|14   |   01:23   |   (2) comments


There's a lot of talk about making networks more simple with SDN, NFV and next-gen broadband technology – but what about the complexity of introducing such capabilities?
Upcoming Live Events
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
May 6, 2015, McCormick Convention Center, Chicago, IL
May 30, 2015, The Westin Peachtree, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Microsoft's Skype Embraces WebRTC on IE
Sarah Reedy, Senior Editor, 10/27/2014
FTC Slaps AT&T With Throttling Lawsuit
Sarah Reedy, Senior Editor, 10/28/2014
Wheeler Gets Down With OTT
Mari Silbey, Independent Technology Editor, 10/29/2014
China's MVNOs Hit the Wall
Robert Clark, 10/27/2014
Let's Not Kill SDN & NFV With Silos
Francois Locoh-Donou, Senior VP, Global Products Group, Ciena, 10/28/2014
Like Us on Facebook
Twitter Feed