IHS: Pay-TV Lost 658,000 Video Subs in Q21 Sep, 2015 By: Erik Gruenwedel
Cord-cutting has officially moved from speculation to reality. The pay-TV industry lost a collective 658,000 video subscribers in the most-recent fiscal quarter, according to new data from IHS. Notably, the period marked the first time non-cable pay-TV operators lost video subs since satellite operators entered the market in the early 1990s.
The sub losses come as Netflix continues to add millions of subscribers globally and media companies launch subscription streaming services in an effort to keep abreast of a rapidly changing market.
Internet-protocol television (IPTV) operators posted minimal positive subscriber growth of less-than 1% in the second quarter, compared with 4% in Q2 2013 and 3% in Q2 a year ago. Satellite operators and cable company subscriptions, however, declined less than 1% year-over-year.
“Until the fourth quarter of 2014, IPTV had been the only pay-TV category to experience growth; however, by Q2 of this year, IPTV’s significant forward momentum had been lost,” Erik Brannon, principal analyst of TV media, said in a statement.
Indeed, both satellite operators (Dish Network, DirecTV) lost significant numbers of video subscribers in Q2. Although Dish attempted to mask losses by including Sling TV subscribers, IHS estimated that the company lost 285,000 total subscribers, while DirecTV lost 133,000, without NFL Sunday Ticket promotions to fall back on.
In addition, AT&T U-verse TV experienced its first quarterly loss in Q2, and the company now claims to be focused mainly on high-value subscribers, according to IHS.
AT&T, which recently closed its acquisition of DirecTV, has begun to rejigger bundled channel offerings, including targeting college students with steeply discounted over-the-top video services.
“AT&T [is competing] with the larger cable operators that are becoming more savvy,” Brannon said.