Rocky
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.