Q2 sees subscriber troubles for operators, cable networks

By Jim O'Neill on Aug 11 2016 at 11:30 AM
Q2 sees subscriber troubles for operators, cable networks

It’s been a tough quarter for pay-TV operators and cable networks.

Every major U.S. operator – with the exception of DirecTV -- lost subscribers in the quarter, led by AT&T’s U-verse TV which lost 391,000 subs, its worst loss since Q1 when 381,000 customers bailed.

Dish Network, meanwhile, said it lost 281,000 subscribers between its core service and Sling TV -- which actually likely gained 50,000-plus subs in the quarter – pushing Dish’s loss closer to 330,000. Charter reported it lost 152,000 subs, Verizon’s FiOS TV was down 41,000, Altice (Suddenlink and Cablevision) was down 25,000 and Comcast 4,000.

AT&T’s DirecTV added 342,000, “the only company in the Top 10 to report organic subscriber growth, although that was largely at the expense of AT&T U-verse,” said informitv analyst Sue Farrell.

The Multiscreen Index from informitv pegged losses at 663,000 subscribers from the Top 10 service providers, up from about 500,000 a year ago.

MoffettNathanson analyst Craig Moffett, meanwhile, said the losses for the industry could be as high as 757,000 in the quarter.

It’s not just the operators, though, that are losing customers, cable networks are being hit, too.

“The gap between cord-cutting, or eliminating one’s pay-TV subscription altogether, and cord-shaving, where skinny bundles replace fat ones, is getting wider,” Moffett said. 

A recent Nielsen estimate put U.S. pay-TV household penetration 2.3% down from a year ago, but Pivotal Research Group said it believed cable networks were down more, about 2.7%.

“The gaps between the two figures are consistent with the notion that cord shaving is impacting owners of cable networks,” said Pivotal Research Group Analyst Brian Wieser in a report earlier this month.

ESPN lost more than 2.2 million subscribers in Q2, and are at risk of losing more as pay-TV operators create new skinny bundles of content that move more expensive channels like ESPN into optional supplemental bundles to reduce costs.

Dish last week launched a basic tier without ESPN, following Verizon’s lead. And, more are likely to follow.

Stay tuned.                                                             

Follow me on Twitter @JimONeillMedia and on LinkedIn

Posted in: 


Data? A growing, critical resource for the pay-TV and OTT industry
Pay TV, OTT, Big Data
Data? A growing, critical resource for the pay-TV and OTT industry
Jul 25 2017 5:15 AM

Earlier this year, a survey of pay-TV providers by the Pay-TV Innovation Forum 2017 found that the majority of pay-TV execs believed data and analytics will be critical to pay TV direction over the next five years.

SVOD, Pay TV, Millennials, Cord Cutting
Q2 likely to be miserable as operators brace for big customer losses; OTT anyone?
Jul 24 2017 3:00 PM

Could second quarter pay-TV subscriber losses in the United States top 1 million, the highest figure ever? In a word, yes.

The second quarter routinely is a weak one for operators and in the current environment – remember the first quarter saw more than 800,000 subscribers cut the cord, according to Kagan – reaching one million may be an easy task.

Pay TV, Live sports, Millennials
A skinny bundle without sports? Duh
May 25 2017 10:30 AM

Skinny bundles from cable operators – and their OTT surrogates like Sling TV – are becoming more common as the companies try to look more attractive to consumers tired of paying for 200-plus channels when they really only watch a dozen or less. Survey after survey has shown that subscribers are hungry for not just a slimmed down offering but also for the subscription savings smaller bundles would engender.

Pay TV, SVOD, Millennials
Is cord cutting over? Far from it, and that’s creating new OTT opportunities
Mar 16 2017 1:15 PM

Has cord cutting finally run its course among U.S. operators who have, over the past five years, watched millions of subscribers walk away from traditional pay-TV delivery? Are Millennials – and their following generation, Gen Edge – ready to join Gen X and Baby Boomers in tying themselves to arcane and expensive contracts that deliver bloated tiers of content that they have little interest in watching, let alone paying for?