Kagan sees ray of hope in pay TV's Q2 numbers

Aug. 17, 2018
Kagan describes pay TV's second-quarter subscriber numbers as "an ameliorating picture for the sector," with cable and DBS losses ...

Kagan describes pay TV's second-quarter subscriber numbers as "an ameliorating picture for the sector," with cable and DBS losses cushioned somewhat by gains in the Internet-delivered video segment.

The pressure on traditional multichannel pay TV subscriptions abated in the second quarter - a positive direction that is further supported by the forwarded momentum of virtual services Sling TV and DirecTV NOW, according to the "Q2 2018 U.S. Multichannel Subscriber Report" by Kagan, the media research group in S&P Global Market Intelligence.

Combined, the cable, direct broadcast satellite (DBS) and telco multichannel sectors lost 860,640 video subscribers in the three-month period ended June 30, ending the quarter at 92.2 million, including 89.4 million residential customers. The DBS platform logged its second largest quarterly decline on record, losing a combined 478,000 customers.

Throwing DirecTV NOW and Sling TV into the mix reduces the quarterly subscription losses by approximately 45%, raising the residential figure to 93.5 million.

Other findings indicate:

  • The residential multichannel penetration rate stood at 75% as of June 30 when including the virtual multichannel services owned by AT&T and DISH Network (DirecTV NOW and Sling TV).
  • Cable logged its largest second-quarter video subscriber drop since 2015, bringing year-to-date losses to 685,790.
  • The telco video segment improved during the period, reducing its losses to just 56,000, or just a fraction of the pattern of quarterly losses established in the last two years.

Related research from the Leichtman Research Group last week indicated that pay TV losses in the second quarter of 2018 were lower than in any second quarter since 2014, partly buoyed by gains in Internet-delivered TV.

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