Cord-Cutting No Longer an ‘Urban Myth’: Pay TV Operators Drop 316,000 Subs in Past Year

Digital Cord Cutting

Industry faces steeper losses even as housing market shows signs of recovery, according to Wall Street analyst Craig Moffett

The number of Americans jettisoning pay TV is still fairly small — but data clearly shows that cord-cutting is picking up the pace as the cost of cable and satellite TV service continues to climb skyward.

The U.S. pay TV sector as a whole lost 316,000 subscribers for the 12-month period ending in June, even as the housing market shows signs of recovering, Moffett Research analyst Craig Moffett wrote in a research report Tuesday.

“Cord cutting used to be an urban myth.  It isn’t anymore,” Moffett Research analyst Craig Moffett wrote in a research report Tuesday. “No, the numbers aren’t huge, but they are statistically significant.”

The latest figures showing the industry decline — which has hit cable operators including Comcast and Time Warner Cable the hardest — comes after pay-TV providers shrank subscriber rolls 80,000 on a year-to-year basis in the first quarter of 2013, according to an analysis by Leichtman Research Group.

SEE ALSO: Cord-Cutting: At Last, Hard Evidence It’s Really Happening

The second quarter is seasonally weak for pay TV, given that colleges shut down and “snow birds head north,” Moffett noted. But for the 12 months ending June 30, pay TV subscribership fell about 0.3% whereas subscribership rose 330,000 (up 0.3%) for the 12-month period ending Q2 2012, according to Moffett, a longtime industry analyst who for years has warned about the affordability problem of pay TV services.

In the face of customer losses, cable and satellite TV operators say they’re focusing on higher-value subscribers, willing to sacrifice bargain-hunting consumers who at satisfied with over-the-top video options like Netflix and free broadcast TV.

In the second quarter, cable operators lost a cumulative 591,000 video subscribers in the second quarter, which actually was better than the 606,000 sequential decline in Q2 2012. Telephone companies AT&T and Verizon grew in the most recent period — adding 231,000 and 140,000 video subs, respectively — while both satcasters lost ground (DirecTV dropped 84,000 U.S. video customers in the period, and Dish Network lost 78,000).

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 4

Leave a Reply

4 Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

  1. Jedi Master says:

    I cut the cord in 2008 and haven’t looked back. Pay TV companies keep jacking up the prices while the quality of programming keeps heading south with reality crap on almost every channel. ESPN keeps buying up sporting rights to sports that used to be on free over the air TV and they jack up the price of their channel to make everybody pay for it. Pay TV has been ruined by corporate greed.

  2. Benjamin Smith says:

    I cut my cord in 2009. We’ve never looked back. Our “DVR” is a PC behind our TV, the bedroom DVR is a Mac mini. Along with a bluetooth keyboard, we have the best of all worlds: Entertainment on demand, very low cost, convenient control from the recliner.

  3. My mother and myself and haven’t had cable TV since 2008. Couldn’t be happier without it. NetFlix, Hulu, Vimeo and YouTube have better content than cable TV (for me, at least)

    The ONLY thing I have really “missed” since 2008 on cable TV, that I thought I wanted to see, was “Game of Thrones”, and maybe “Gasland 2” .. but those 2 shows just can’t be worth $140 / month, sorry.

    Duck Dynasty? Here comes Honey Boo Boo? ANOTHER Reality show? The Bachelorette, Season 3? Yeah, I’m done with “lowest common denominator” television forever…. You’re insulting my intelligence with that drivel.

    Oh, and DirecTV, you can seriously go F**K yourself. Don’t ever give DirecTV access to your checking account people, their phone reps will tell you “no cancellation fee”, and then management will steal from you. True Story, it happened to me in 2003.

  4. John Watson says:

    It’s only going to get worse for Cable/Satellite TV providers as services like Netflix and Hulu continue to gain traction and offer more programming. It just isn’t worth it for me to pay $50 a month for cable when all I really care about is like 5 of the 80 or so channels that I get. They (cable/satellite provides) really need to start offering lower price more customizable programming packages for me to personally ever bother with pay TV again.

More Biz News from Variety

Loading