Pay TV Sees Worst Year Ever In Subscriber Growth, But Overall Revenues Climb

TVRocky times for pay TV business remain, especially when it comes to keeping or growing customers for cable operators. Yet overall revenue continues to climb.

In terms of new subscriber growth, media/telecommunications research company, MoffettNathanson points out: “The pay TV industry reported its worst twelve more stretch ever."

Overall, the total pay TV business was down 113,000 customers, or 0.2% from a year ago in the third quarter. This followed a second-quarter 2013 decline of 396,000, or 2% versus the second quarter of 2012.

Cable operators were the big losers -- dropping 687,000 customers or 3.4% in the third quarter of 2013 versus the same period in 2012. By comparison, satellite TV distributors inched up 174,000 customers or 0.5%. Telco TV distributors such as Verizon FiOS and AT&T's U-Verse climbed 400,000 or 16.8%.

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All this means tougher times ahead -- especially as those pay TV distributors attempt to slow down higher fees from networks programmers.

Craig Moffett and Michael Nathanson write: “The media industry's singular reliance on affiliate fees as a source of growth will ultimately be problematic for those networks with limited scale and an absence of must have content.”

Brighter news: Actual “cord cutting” seems to be slowing -- all this when factoring in household formation. That's because according to the U.S. Census there were 366,000 fewer “new occupied dwelling units” -- about 2% --  in the third quarter of 2013 versus the third quarter of 2012.

MoffettNathanson says pay TV revenue growth is still at a decent 5.3% growth rate year-over-year as a result of higher consumer pay TV monthly pricing -- although this may be a problem with potential cord-cutting customers down the road.

3 comments about "Pay TV Sees Worst Year Ever In Subscriber Growth, But Overall Revenues Climb".
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  1. Edmund Singleton from Winstion Communications, November 13, 2013 at 11:14 a.m.

    I never understood why a promo is not run stating 'no on-screen logo', then watch the fish jump into the boat...

  2. Bobby Campbell from Adkarma, November 13, 2013 at 12:27 p.m.

    Is cord cutting a good measure of health if Millennials aren't even signing up? I think PayTV/Cable are facing some real challenges with the changing viewer habits and mulitiple new platforms and services for consuming content. But they would have the muscle to transform and dominate the new market if they could change quick enough. They need to kill the baby

  3. Edmund Singleton from Winstion Communications, November 14, 2013 at 7:23 a.m.

    On second thought. If you grew up with a on-screen logo on everything its normal for you and easily accepted...you know no better, unless you subscribe to HBO...

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