US pay-TV losses reach a nadir

The full US pay-TV market lost a record 2.37 million subscribers in Q1 2024, according to MoffettNathanson's latest estimates. Even YouTube TV, a service that has bucked the trend, shed customers in the period.

Jeff Baumgartner, Senior Editor

June 20, 2024

3 Min Read
Cord cutting, wireless, streaming television concept
(Source: JJ Gouin/Alamy Stock Photo)

The rough times in pay-TV got even rougher in the first quarter of the year.

US pay-TV providers, including virtual multichannel video programming distributors (vMVPDs), combined to shed a record 2.37 million subscribers in the first quarter of 2024, according to the latest estimates from MoffettNathanson. Those losses compared to a year-ago loss of 2.35 million.

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Traditional pay-TV operators (cable, satellite and telcos) lost a combined 1.90 million subs in the quarter.

Within that traditional grouping, US cable operators took it on the chin the hardest. They combined to lose 1.14 million subs in Q1 2024, a tick below the 1.11 million they lost in the year-ago period.

US satellite operators (Dish and DirecTV) lost 589,000, an improvement from a year-ago loss of 759,000 subs. US telcos were estimated to lose about 168,000, a bit better than the 211,000 they lost in the year-ago period.

vMVPDs, once again, did not pick up the slack, losing 469,000 subscribers in the first quarter of 2024, widened from a year-ago loss of 265,000.

The vMVPD "conversion rate" (the rate at which traditional video sub losses are re-captured by vMVPDs) was just 28.2% in the first quarter of 2024.

"To state the obvious, the vMVPDs are not a panacea for linear video," MoffettNathanson analyst Craig Moffett noted in his latest "Cord-Cutting Monitor" report (registration required).

The rate of decline in pay TV, excluding the vMVPDs, dropped to an all-time worst of -12.3%. With vMVPDs included, the rate of decline was about -6.9% – also a record low.

YouTube TV's first quarter loss

The quarter was so bad that even YouTube TV apparently did not get out of it unscathed.

YouTube TV, a streaming service that has been able to buck the trend in pay TV and dominate the vMVPD market, likely lost subscribers for the first time, according to Moffett's analysis.

Google does not disclose quarterly subscriber numbers for YouTube TV, but Moffett believes YouTube TV lost about 150,000 subscribers in the first quarter, off from an estimated gain of 250,000 in the year-ago period. The analyst attributed the loss in Q1 to customer churn linked to NFL Sunday Ticket, the out-of-market football package that is now exclusively distributed via YouTube and YouTube TV.

Most other vMVPDs didn't fare well in the quarter, either – Hulu's live TV service lost about 100,000 while Dish-owned Sling TV shed 135,000 and Fubo lost 107,000. DirecTV Stream, with a small gain of about 23,000 subs, was the outlier, according to Moffett's estimate.

When US pay TV swung to its prior record subscriber losses in Q1 2023, Moffett referenced twin "doom loops" that illustrated the gloom encompassing pay TV – rising prices and the "strip-mining" of quality content from linear TV networks to direct-to-consumer streaming services that ultimately sap the value of the pay-TV bundle.

In his latest report, Moffett identified another doom loop or "wheel" in which ad spending on streaming is growing faster than subscribers on the streaming platforms themselves, thus "further undermining the traditional ecosystem."

"As the media conglomerates have increasingly embraced ad-supported tiers for streamers like Hulu, Peacock and now more recently Netflix, Disney+ and Amazon Prime Video, advertisers have dutifully followed, increasingly moving their ad budgets to the new, new thing," Moffett explained. "Like the other two doom loops, this ad budget migration is self-reinforcing. Advertisers move budgets. Management teams, chasing those budgets, move even more marquee content to streaming. Advertisers therefore move even more of their budgets. Importantly, the three 'wheels' are mutually reinforcing; each of the three makes the other two spin faster."

About the Author(s)

Jeff Baumgartner

Senior Editor, Light Reading

Jeff Baumgartner is a Senior Editor for Light Reading and is responsible for the day-to-day news coverage and analysis of the cable and video sectors. Follow him on X and LinkedIn.

Baumgartner also served as Site Editor for Light Reading Cable from 2007-2013. In between his two stints at Light Reading, he led tech coverage for Multichannel News and was a regular contributor to Broadcasting + Cable. Baumgartner was named to the 2018 class of the Cable TV Pioneers.

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