TV Cord Cutting Poised To Smash Records During Second Quarter

from the inevitable-(r)evolution dept

So we've already noted that with the rise of streaming video competition, more people cut the TV cord last year than any other time in history. MoffettNathanson analyst Craig Moffett has noted that 2016's 1.7% decline in traditional cable TV viewers was the biggest cord cutting acceleration on record. SNL Kagan agrees, noting that traditional pay TV providers lost around 1.9 million traditional cable subscribers. That was notably worse than the 1.1 million net subscriber loss seen last year. And once you factor in the fact that people are buying and moving to new homes without signing up for cable, the full numbers are actually worse.

And things are only going to accelerate as companies like Dish (Sling TV), Sony (Playstation Vue), Google (YouTube TV), Amazon and others flood the market with cheaper, more flexible, streaming alternatives.

Pay TV providers already lost roughly 789,000 subscribers this year. Wall Street analysts expect the second quarter to see more than 1 million subscriber defections away from cable. The second quarter is already historically the worst of the year for cord cutting, as college students cancel school service and pad the defections. This year, however, the belated rise in real streaming competition means things will be arguably worse:

"Pay TV providers could lose more than a million subscribers in the current period, a team of analysts at UBS led by John C. Hodulik wrote in a research note distributed Tuesday. "That would be the worst result on record and equate to a 2.5% annual decline," compared to 2.1% last quarter, the analysts wrote.

And things for the industry could only get worse, the analysts wrote.

"We estimate this will put the industry on pace for a 3.3% decline in 2017 and 4.0% in 2018," they said in their note.

You might just notice a bit of a trend after UBS put its estimates into visual form:

As we've long noted, none of this will be fatal for industry giants like Comcast, who plan to counter lost TV revenues by jacking up broadband prices via arbitrary and otherwise unnecessary usage caps, using bundled pricing to force people to take TV bundles they may not even want. The broadcast and cable TV sector could also easily counter these losses by doing something uncharacteristic and unthinkable for the sector: listening to these defecting customers and actually competing on price and package flexibility.

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Filed Under: cable, cord cutting, tv


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  1. identicon
    Anonymous Coward, 13 Jun 2017 @ 9:54am

    Re: It's just a temporary downturn

    I would cut the cord and have in the past. But currently it's cheaper t get their dumb bundle then it is for Internet only. So I have the bare Minimum cable TV package which is mostly local channels, plus HBO (Had a choice of HBO or Showtime) as a very basic cable Box. You know what, that cable box is still in the packaging it came in. I've never hooked it up and don't plan to. Plus I'd have to run new cable to use it and I have no reason to.

    I get my Local channels with a Antenna already and use a TIVO and Mini's for my DVR solution. I'd lose the DVR if I used Cable. Screw that. HBO I just use the HBOGo App on my Roku's or Apple TV's. Comcast doesn't allow HBOGo to work on Tivo's. It's there on Tivo, but for other company's to use. Comcast has a stick up their butts against Tivo.

    So I have their 200Mbps service right now which they said was $10 more to get then the 100Mbps connection. So I figured I'd try it. Of course I went over my CAP and they threatened $10 for 50 Megabtyes over, so I was $20 extra change. I guess they say you get 2 free over months. Oh boy. Faster speed just means hitting the cap even faster and easier. So I called up telling them I wanted to go back to 100Mbps and save the $10. I couldn't do it. I could save $10 and drop way down to 25Mbps service, WTF!!! Comcast SCAMMING as always.

    If only I had a real option, I'd flee as fast as I could.
    The only reason more people arn't cutting is because they're doing all they could to keep people on with a bundle for a cheap which is cheaper and then jack prices up after the year. I call every year and get my costs cut back done for another year.

    I would still rather have Internet only. I won't watch their cable TV local channels, I RARELY even watch HBO. I wouldn't miss it. I don't have enough time to watch all this crap. But they're scamming people with bundles to keep them on TV subscriptions so it doesn't look as bad as it could be.

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