Strategy Analytics: U.S. Pay-TV Subs Down, ARPU Up

ADVERTISEMENT

BOSTON: U.S. pay-TV subscribers declined by 479,000 in the second quarter, but the average revenue per user (ARPU) is on an upward trajectory, according to new figures from Strategy Analytics.

Strategy Analytics' Service Provider Strategies (SPS) service report, Digital Television Operator Performance Benchmarking: North America, finds that the top 20 tracked operators in the U.S.—accounting for more than 95 percent of the total market—saw subscriber losses of 479,000 while the operators in Canada lost 53,000 customers. Digital platforms were not immune from the decline either: digital TV subscriptions in the U.S. fell by 62,000 and in Canada by 9,000.

Though subscriber numbers have been fluctuating for years, the average revenue per user (ARPU) has almost consistently been on an upward trajectory. In the second quarter, DISH Network lost 81,000 subscribers, even after accounting for growth in the company's new OTT service, Sling TV. At the same time, DISH Network's Video ARPU increased by 2.5 percent quarter-over-quarter and 4.5 percent year-over-year. At DIRECTV, ARPU was up 6.5 percent year on year. Charter saw 4.6 percent year-on-year gains. Time Warner saw a smaller increase, but an increase nonetheless, with a 1.4 percent gain.

"The subscriber losses in the second quarter were across all of the pay-TV platforms, including cable, satellite and IPTV. However, going forward, we believe there are clear opportunities for the pay-TV providers as they begin to roll out over-the-top video services similar to Dish Network's Sling TV offering," said Jason Blackwell, the director of the SPS at Strategy Analytics.

He added, "Verizon will debut its OTT service this year, along with Comcast and CenturyLink. Although nothing has been announced, AT&T (with its DIRECTV acquisition) is predicted to roll out an OTT video service, and the company is uniquely positioned to tie that into a variety of nationwide bundles that could also include fixed or mobile broadband, satellite TV and wireless phone service."