08.23.2010 12:00 PM
SNL Kagan: Pay TV Subscribers Dwindle
PenguinsMONTEREY, CALIF.: People abandoned cable TV in record numbers during the second quarter of 2010, according to analysts at SNL Kagan. Cable lost 711,000 subscribers, with six of eight MSOs reporting their worst quarterly video losses as well.

The Internet--for once--isn’t believe to be driving the exodus. It’s the diminished economy and the resulting unemployment and poor housing starts.

“Although it is tempting to point to over-the-top video as a potential culprit, we believe economic factors such as low housing formation and a high unemployment rate contributed to subscriber declines in the second quarter,” Kagan’s Mariam Rondeli said. “We are also seeing churn resulting from the broadcast digital transition, which boosted video uptake early last year, as many have abandoned their paid subscriptions once initial promotional contracts expired.”

The overall U.S. multichannel market was dragged down by the cable loss, delivering its worst performance on record during 2Q10. Pay TV providers lost 216,000 customers in the quarter compared to a 378,000 gain in the same period last year.

Kagan said full subscriber counts for cable, direct broadcast satellite and telcoTV dropped to 100.1 million in the second quarter. DBS and telcoTV added 81,000 and 414,000 subscribers, respectively.

Cable operators’ share of combined video subscribers dropped to 61 percent versus 63.6 percent in 2Q09. Telcos continue to take market share in the TV provision business, growing from 4.3 percent in second-quarter 2009 to 6 percent in 2Q10. Although the DBS industry expanded market share over the past year, the gains have been modest at less than 1 percent, Kagan said.

Nielsen Media Research data also shows cable penetration at 61.1 percent of TV households, and 67.4 percent of pay TV households.

One place cable operators held their own during the quarter was in broadband provision. The top 10 or so cable operators in the United States added 344,000 broadband subscribers in 2Q10, versus 246,000 a year ago, Leichtman Research Group reported. Cable operators have a 55 percent market share in broadband, up about 1 percent from a year ago.

The top eight phone companies lost a collective 7,500 broadband subscribers, compared to a gain of 385,000 in 2Q09. The net result was that broadband subscriptions grew at their slowest rate since Leightman started tracking the industry nine years ago--by a total of 336,000 subscribers.

-- Deborah D. McAdams

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Posted by: Deborah McAdams
Fri, 12-09-2011 10:57 PM Report Comment
You really make it seem so easy with your presentation but I find Karen millen dresses this topic to be really something which I think I would never understand.

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