Pay TV Revenue Will Grow, Subscribers May Not
Subscription TV -- which accounts for 90% of all U.S. TV homes -- will continue to grow in total revenue in the coming years, largely as a result of consumers adding programming and services to their cable, satellite and telco video packages -- not adding more subscribers.
The Cambridge, Mass. market researcher Pyramid Research says pay-TV revenue in North America is expected to grow by 25% in five years to $125 billion. The research company says all this comes despite a declining number of cable and other TV distribution pay TV subscribers.
Pyramid says the total pay TV market was $99 billion at the end of 2011.
Nielsen recently noted there were 103.5 million cable, satellite, and telco subscribers in the U.S. at the end of 2011. At the end of 2010 there were 105 million. This decline was mostly due to a decrease in cable subscribers -– down 5% to 60.5 million. Telco subscribers were up, while satellite subscribers were flat.
Recent earning reports from the big cable TV operators -- Comcast, Time Warner, and Cablevision Systems among them -- all continue to tout a higher monthly average price tag per subscriber, a trend that has continued for a number of years.
Cablevision Systems, for example, in its most recent earnings report says that its video customers' monthly average price tag grew almost 2% to $152.53 a month.
Cable system operators continue to gain revenues with new digital equipment/services and higher-priced add-on pay TV movie and sports networks.