U.S. Pay-TV Base Fell in Q3

MONTEREY: The number of people subscribing to pay-TV services in the U.S. fell by 119,000 customers in the third quarter, as compared with the 346,000 additions in the year-ago period.

The new data from SNL Kagan comes amid increasing concerns about cord-cutting—customers canceling their pay-TV services because so much content is available for free online. This is the second consecutive quarter of video subscriber declines. In the past six months, the base has fallen 2.3 percent to just over 100 million subs.

The research indicates that U.S. cable TV operators lost 741,000 basic-video customers in the period (the single largest quarterly dip for cable since SNL Kagan began compiling data for the segment in 1980). Cable MSOs’ share of the pay-TV base fell to 60.3 percent from 62.9 percent. Telcos, however, added 476,000 customers, with its share rising from 4.7 percent to 6.4 percent. Satellite grew its base by 145,000, upping its share by less than 1 percent to 33.2 percent.

“Operators are pointing to a continuation of the forces that pushed subscriber gains into negative territory in the second quarter, including the weak economy, high unemployment and elevated churn of former over-the-air households,” said Ian Olgeirson, senior analyst at SNL Kagan. “However, it is becoming increasingly difficult to dismiss the impact of over-the-top substitution on video subscriber performance, particularly after seeing declines during the period of the year that tends to produce the largest subscriber gains due to seasonal shifts back to television viewing and subscription packages.”