DALLAS—As cord cutting continues and pay TV operators look to find ways to hang onto existing subscribers, Parks Associates has released a new survey that highlights the top reasons for keeping a pay TV service.

The white paper, “Unified Streaming: Unlocking Next-Gen Advertising”, developed in partnership with Philo found having access to live programming was one important factor, with 44% saying they wanted access to live news and programming and 39% reporting that they wanted live sports.

Another important factor was the advantages of having a unified video platform that bundles services and aggregates programming. About 38% cited the fact that they bundled video packages with internet access; 33% of pay-TV subscribers say they keep pay TV services because they can find more of the content they want all in one place.

The shift in consumer sentiment towards appreciating the value of bundles and aggregated content is somewhat ironic given the fact that bloated costly programming packages and bundles were one of the early factors driving cord cutting.

"Aggregation is now a strategic advantage," said Elizabeth Parks, president and CMO, Parks Associates. "Unified platforms simplify discovery, deepen engagement, and provide advertisers with more consistent measurement and targeting capabilities. A key finding of our research shows the strength of streaming TV (vMVPD) audiences as a foundation for next-generation advertising."

Other key findings include:

• The average US internet household subscribes to 5.3 streaming services, contributing to growing complexity and "decision fatigue."
• More than 300 streaming services exist in the US market, reinforcing fragmentation challenges.
• Streaming TV is the anchor for the unified video platform, and its users are far more likely to engage with interactive ad formats, creating new opportunities in advertising innovation:
• 55% of streaming TV subscribers are interested in clicking on items in content for more information vs. 31% of non-vMVPD subscribers.
• 51% are interested in clicking on items in ads vs. 27% of non-users.
• 49% are interested in shopping for special merchandise/memorabilia related to a show or sporting event vs. 23% of non-users.

"vMVPD subscribers, like Philo's lifestyle and entertainment viewers, are watching longer than nearly anyone else in streaming. What this research confirms is what our advertising partners already see in their results: sustained, engaged viewing creates some of the strongest environments for CTV advertising," said Reed Barker, head of advertising, Philo.

The research also highlighted the growing importance of hybrid monetization models, combining subscription, ad-supported, and transactional offerings. These models allow providers to balance profitability with audience growth while delivering more flexible viewing experiences.

In addition, the white paper identifies lifestyle content as a major opportunity for advertisers. These audiences show strong alignment with commerce-driven advertising, with higher-than-average mobile purchasing behavior and interest in interactive features.

NTCA—The Rural Broadband Association (NTCA) has come out strongly against the proposed merger of Nexstar and Tegna in a filing with the Federal Communications Commission arguing that “any relaxation of the national television ownership cap” will force operators to pay higher retransmission consent fees, which in turn will have a “severe and worsening impact” on rural communities by forcing consumers to pay higher prices.

“NTCA therefore opposes the merger and urges the Commission to reject it as contrary to the public interest and inconsistent with the Commission’s commitment to serving rural America,” the group said.

NTCA is an industry association composed of approximately 850 community-based companies and cooperatives that provide advanced communications services in rural America and more than 400 other firms that support or themselves are engaged in the provision of such services.

In a Jan. 26 filing with the FCC, the NTCA cited survey data that “highlights the troubling escalation of retransmission costs foisted upon rural video providers. In their most recent retransmission consent negotiations, rural MVPDs experienced average fee increases of $128,351, a substantial rise from the $104,020 increase in 2024 and the $78,022 increase in 2023,” the group said. “This acceleration in fee growth demonstrates that the cost pressures identified by NTCA in previous comments are only intensifying. The impact on rural consumers is severe, as roughly 87% of these providers report having had to pass these increased fees directly on to their subscribers. Research continues to demonstrate that MVPDs pay significantly more for programming from large, consolidated broadcast groups compared to independent stations.”

“Nexstar Media is already among the nation’s largest and most powerful broadcast groups,” the filing stressed. “The proposed addition of Tegna’s 64 stations would concentrate further control over programming. Based on the pattern evident in NTCA’s survey data, approval of this merger would likely deliver to Nexstar even greater bargaining power to demand higher retransmission consent fees, with rural MVPDs and their consumers bearing the cost. The timing of this merger application, following a year of particularly steep fee increases, underscores the critical importance of maintaining ownership limits to preserve whatever negotiating leverage remains for small rural operators.”

The full filing can be found here.

TV Tech’s full coverage of the proposed deal can be found here and here with numerous articles laying out arguments by Nexstar and Tegna that the ownership caps should be lifted and that the deal would have a positive impact on the broadcast industry.

In a year where ad dollars and audiences continued to shift towards streaming platform, our coverage of streaming media continued to be among the most popular items on the TV Tech website.

Regulatory issues, blackouts on streaming platforms like YouTube TV, the ongoing rise in popularity of short form video and the decline of pay TV as consumers spent more time and money on streaming services, were among this year’s top 10 articles and topics.

Here are the top 10:

1. Carr Weighs in on Disney, YouTube Dispute

“People should have the right to watch the programming they paid for — including football” the FCC chair said in a X post.

2. Parks: Social Video Now Accounts for 20% of TV Viewing

Viewers watch more social video weekly than pay TV and broadcast according to Parks Associates.

3. NFL Viewers Embrace Interactive Shopping and Social Experiences on Game Day

New survey indicates that about half have shopped for NFL merchandise while watching games.

4. Point/Counterpoint: 5G Broadcast vs. NextGen TV

Industry veterans Preston Padden and Mark Aitken share their views on which standard should drive the future of U.S. television.

5. Middle-Aged Viewers Power YouTube Long-Form Content

35-to-64-year-olds emerge as YouTube’s long-form ‘content super-consumers,’ according to Ampere Analysis.

6. Peacock to Stream ‘Sunday Night Football’ in Dolby Atmos

Season kicks off with streaming coverage of Eagles-Cowboys in immersive audio.

7. Fubo to Launch 'Fubo Sports' Skinny Bundle for $56 Per Month

Fubo Sports will launch Sept. 2 with 20+ sports and broadcast networks featuring national and local pro and college team coverage.

8. YouTube TV to Drop Fox Channels If Agreement Is Not Reached

With the start of another football season, a new carriage dispute has arisen.

9. New NBCUniversal, YouTube TV Deal Includes the Return of NBC Sports Network

Google and NBCU reach long-term agreement across YouTube TV, Peacock, YouTube, Universal Pictures Home Entertainment and NBCUniversal Global TV Distribution.

10. S&P: Pay-TV Subscriptions Decline for Ninth Straight Year

No sign of relief for an industry that saw subscriber loss of 7.1% in 2024.

PLANO, Texas—Even though streaming is an increasingly mature business, Parks Associates has released a new report projecting steady but moderate growth across subscription video services, with total TV and video subscriptions climbing from 719 million in 2025 to 765 million by 2030.

Meanwhile, total subscription TV and video revenue will rise from $186.5 billion in 2025 to $190.7 billion in 2030 in the U.S.

The data comes from its latest Subscription Video Forecast: 2025–2030, which offers a comprehensive outlook on the future of the U.S. TV and streaming video market.

The researchers stressed that the new forecast highlights a maturing yet resilient market that is being shaped by ongoing consumer migration toward streaming, the rapid expansion of ad-supported tiers and the continued contraction of traditional pay TV services.

The average monthly spend per TV household on subscription TV and video will grow from $101.25 in 2020 to a peak of $122.74 in 2028, mainly due to rising prices, before a slight dip to $122.04 by 2030. This steady increase assumes consumers are willing to pay more for premium content, bundled services, and multiple subscriptions.

"As the U.S. video market matures, growth is no longer about adding new households — it's about optimizing value," said Michael Goodman, research director at Parks. “Consumers are stacking more services, gravitating toward ad-supported tiers and demanding more flexibility. Our model shows a stable but fundamentally transformed market where streaming is the economic engine and pay TV becomes a smaller, more-specialized segment.

The Subscription Video Forecast combines Parks’ proprietary research with a multilayered quantitative modeling framework that covers the following areas:

• Total U.S. TV and streaming video subscription trends.
• SVOD household adoption and service stacking.
• Ad-supported tier growth and revenue modeling, by major service provider.
• Pay TV subscriber and revenue declines by service provider.
• Shifting consumer value perceptions and market saturation.
• Strategic implications for operators, streamers, and hybrid platform providers.

More information is available on the Parks Associates website.

After eight years of declines, MoffettNathanson's new "Cord Cutting Monitor" for Q3 2025 shows that pay TV subscribers to linear TV packages rose by 303,000, the first reported rise in multichannel video programming distributor and virtual MVPD sub counts since 2017.

The last time subscriber counts rose was in Q4 2017, when they increased by 318,000, per data from MoffettNathanson. The slight increase in Q3 is a notable turnaround from the 2,455,000 pay TV sub losses in Q1 2025 and 1,054,000 in Q2 2025.

The analysts stressed that the increase was likely seasonal, as subscriber counts traditionally improve at the start of the football season.

Traditional pay TV operators like Comcast and Charter Communications continued to show declines, and the increases came from vMVPDs like YouTube TV. But MoffettNathanson offered more encouraging news for the pay TV sector with data showing that the rate of decline continued to slow.

“The rate of decline for traditional distributors improved for the fifth straight quarter,” the report stated. “While the rate of decline is still scary-high, it is unmistakably moderating. At Comcast, the trend has been improving for eight straight quarters; there, the rate of decline was the ‘slowest’—although no one would actually call it ‘slow’—since 2022. Even DirecTV and EchoStar have shown at least a little improvement. By far the biggest improvement, however—not just for traditional distribution but for the whole video industry—has come at Charter.”

The report also noted that “the vMVPDs are still growing” but “also more slowly.” The vMVPD category “is growing at a 4.6% annual rate. That’s unchanged versus each of the two prior quarters…even though it remains the slowest growth rate since the category was created,” the report said.

PHILADELPHIA—Comcast's Xfinity operating brand has announced the launch of new national video plans with all-in pricing that the operator said will provide customers with better value and transparency.

Available to new and existing customers, all packages come with an included X1 4K TV box and voice remote, and features like like Multiview, Enhanced 4K, Fan View and StreamStore.

The changes are part of a push to simplify pricing and offerings. Earlier this year, Xfinity launched all-in pricing and a five-year price guarantee for its Internet packages, all of which now include unlimited data and an advanced Xfinity WiFi gateway at no extra cost.

As previously reported, it has also launched Xfinity StreamSaver, a streaming bundle of Netflix, Apple TV+ and Peacock, that can save customers over 40% on some of the most popular streaming services, Comcast said.

When the new video plans are combined with Xfinity’s recently launched national internet plans, Comcast said, it can offer customers savings of over $70 per month for a year when compared to AT&T and Verizon.

“Like we did with Xfinity Internet, we’ve simplified and reimagined our video packages, making it easy and hassle-free for our customers to enjoy great content on the best and most innovative entertainment experience,” said Steve Croney, chief operating officer and incoming CEO, Connectivity & Platforms, Comcast. “When combined with Internet and mobile, our new video packages offer unmatched value, plus there’s even more opportunity for savings with bundles like Xfinity StreamSaver.”

Comcast said that each plan offers one simple, all-in price with major fees included and no contracts or commitments required. Customers can save $10 every month when they bundle their video package with Xfinity Internet. The most popular video plans now include 300 hours of DVR storage. With the Xfinity Stream app, customers can watch their channels at home or on-the-go via supported third party platforms like Apple TV, Fire TV, iOS, Android, Roku, Xumo TV, and more.

Monthly pricing for the new plans is as follows:

Many cord-cutters looking to reduce their monthly cable or satellite bills are also cutting back on streaming costs, according to new research from All About Cookies. The independent digital privacy education site found that 74% of consumers dropped a streaming service in the past year because of rising prices or switched to a cheaper or ad-supported option.

The research found that, on average, Americans subscribe to 3.4 streaming services. Twenty-seven percent subscribe to five or more services, and the average amount paid monthly for streaming subscriptions is $48.13.

The new research underscored the extent to which the public has dropped traditional TV sources like cable and satellite. Less than one-third (30%) of Americans now use these traditional TV services, the survey found.

When asked if they regretted cutting the cord to get rid of cable or satellite TV subscriptions, only 5% of respondents said they did, All About Cookies reported.

The research also looked at what people use to watch TV. Ninety percent of respondents said they subscribe to paid streaming services, up 14% from 2024; 58% use free streaming services, up 15% from 2024; 30% use cable or satellite, down 16% from last year; 18% report using an antenna and free broadcasts, up 3% from last year; and the percentage of those who do not watch TV at all remained the same compared to 2024, standing at 2%.

When it comes to the percentage of people subscribing to various popular paid streaming services, Netflix and Prime Video ran neck in neck in 2025, with 69% of respondents reporting subscribing to the former and 66% to the latter. Bringing up the rear were Apple TV at 15% and YouTube TV at 12%, All About Cookies found.

The findings are based on a survey of 1,000 U.S. adults last month via Prolific. All anonymous respondents were older than 18 and were U.S. citizens.

More information is available on the All About Cookies website.

The traditional pay-TV sector saw a decline in subscriptions for the ninth consecutive year according to a new report from S&P Global Market Intelligence. The decline was largely due to cord cutting, with penetration dropping from over 80% in 2011 to 34.4% by the end of 2024. This shift reflects a broader consumer preference for streaming services over traditional cable, S&P said.

"Basic cable networks in the US shed subscribers in 2024 at an average rate of 7.1% as the pay TV universe continues to contract. This marks the ninth consecutive year of the declining subscribers for the industry as consumers trade in their traditional pay TV subscriptions for streaming services and other digital options."

Competition from streaming SVOD services as well as virtual multichannel video program distributors (vMVPDs) like YouTube TV. Overall, there were 23.0 million virtual multichannel subscribers, including services like YouTube TV.

Among the 190 networks analyzed, 36 have over 60 million subscribers, while 49 have less than 10 million. This disparity highlights the uneven distribution of subscribers across networks, with some networks maintaining a strong subscriber base despite industry challenges, S&P said.

The most widely distributed channels were C-SPAN, with 69.6 million subscribers, followed closely by Food Network with 68.4 million. Both networks benefit from being included in basic packages, contributing to their high subscriber counts, S&P said.

The average cable network is anticipated to see a 5.4% annual decline in subscribers from 2025 to 2029, with C-SPAN and Food Network projected to lose 15 to 20 million subscribers by 2029.

C-SPAN announced last week that YouTube TV and Hulu Live Plus would begin carrying the non-profit network this fall.

SAN JOSE, Calif.—Cost-conscious TV viewers are cutting back spending on streaming services, preferring quality programming over a large number of choices, TiVo said in a report released today.

In its “Q4 2024 Video Trends Report,” Xperi-owned TiVo found consumers have begun to declutter their video libraries. This trend of streamlining video services underscores the critical role high-quality content plays in driving sustained engagement and connection with consumers, TiVo said.

In fourth-quarter 2024, TiVo found that consumers decreased their entertainment spending by nearly $20 year-over-year, with the average number of services used declining from 11.1 to 9.9 in the same period. It marked the first time average monthly entertainment spend dropped below $160 since before 2021—it had peaked in 2022 with an average monthly spend of $189.38.

Among those who canceled a subscription video-on-demand service (SVOD) within the last 6 months, 17% said they did so because they “weren’t using it enough” and 16.9% said it was because the service raised its prices. This decrease, paired with a plateau of hours spent watching video, highlights that consumers are spending the same amount of time consuming content on linear and streaming TV, but on fewer services. This points to a reprioritization of how and what consumers chose to spend their time on, indicating a migration towards value.

Unlike in previous years, when consumers were willing to pay for ad-free SVOD services, TiVo says today’s consumers opt for richer content libraries, regardless of ad presence, as they seek a more simplified and value-driven entertainment experience. With this shift, consumer ad tolerance rose year-over-year from 75.3% to 76.2% and viewers chose more personalization. As the streaming landscape continues to evolve, the platforms that successfully win over consumers will be the ones that deliver both value and relevance.

“We are seeing a shift in consumer priorities as they look for ways to reduce the number of services they use without sacrificing access to quality content,” said Xperi’s chief product and services officer, Geir Skaaden. “As consumers face economic uncertainty, there will be increased pressure on the entertainment industry to deliver quality content and keep users engaged for long periods of time.

“There is a chance we will see a similar spend and entertainment consumption trend from that which we experienced during the pandemic, with consumers searching for cost-saving measures and spending more time at home, increasing the value in which consumers place on entertainment,“ Skaaden continued. “This new balancing act is and will continue to put more pressure on the entertainment ecosystem to deliver value with relevant and timely content.”

While consumers continue to trim down their streaming services, pay TV is seeing a revival. The number of users planning to cut the cord declined 2% year-over-year, indicating that consumers are staying with cable. This renewed interest has been fueled by unrestricted access to popular entertainment—especially sports—freeing consumers from the walled gardens of many streaming platforms.

In fact, sports emerged as a focus for consumers in Q4 2024. Amid an increasingly fragmented viewing landscape, 58.0% of respondents reported being unable to watch specific sporting events due to lack of access through their subscribed services, leading to frustration when games weren’t available (49.0%) and unveiling an opportunity for providers who can bring sports viewing together to win with consumers.

Additional TiVo Video Trend Report highlights:

• In-car viewing is on the up and up: In-car entertainment viewing increased by 6.0% year-over-year as respondents reported using video to pass the time while waiting in the car and to keep children entertained. Of those who watch video in the car, 75.1% reported doing so at least a few times a month.
• Sharing is caring: Password-sharing has been a hot topic for users and service providers alike, the TiVo report found that 34.6% of respondents shared a SVOD password for at least one service.
• All at once vs. one at a time: About half of respondents shared that they preferred when streaming services release an entire season at once, compared to 19.0% who prefer a slower release cadence of an episode a week; the remainder did not have a preference.
• Personalized ads at all costs: With 41.6% of respondents sharing that they prefer personalized ads no matter the platform, advertisers face greater pressure to provide relevant content that drives meaningful engagement through both linear and CTV options—especially as consumers prioritize quality content.

Find more information from the latest Q4 2024 Video Trends Report here.

Since 2012, TiVo has surveyed consumers to uncover key trends relevant to TV providers, digital publishers, advertisers and consumer electronics manufacturers. The latest TiVo Video Trends Report surveyed 4,490 adults 18 and older living in the U.S. and Canada during the fourth quarter of 2024 (3,485 in the U.S. and 1,005 in Canada).

In addition to identifying and analyzing key trends in viewing habits, the TiVo Video Trends Report provides insight to consumer opinions regarding subscription video on demand (SVOD), transactional video on demand (TVOD) and advertising-based video on demand (AVOD) providers, emerging technologies, connected devices, over-the-top (OTT) apps and content discovery features, including personalized recommendations and search.

New data from Horowitz Research once again shows how important Latinx consumers are to the TV, streaming and video industry, with a survey finding they are more likely to use FAST channels and have higher subscription rates for pay TV services and SVOD streaming services.

As a time of rapid change in the TV business, with streaming on the rise and pay TV declining, the “State of Media, Entertainment, and Tech 2025 Volume I: Subscriptions FOCUS Latinx” report found that 47% of Latinx or Hispanic consumers still have a video subscription from a MVPD, higher than the 44% rate of the total population.

At the same time, 92% of Latinx homes had SVOD services (higher than the 81% of the total population) and 35% had subscriptions for vMVPDs like YouTube TV (notably higher than the 23% rate of the total population).

Latinx consumers also overindexed in usage of free streaming services, with 80% using FAST channels compared to 70% for the total population.

These trends translate into a wider mix of services in Latinx homes. About 43% of Latinx homes had both MVPD and streaming services (versus 33% for the total population). Only 3% of Latinx homes had no subscriptions (versus 11% for the total market) and only 4% had just an MVPD subscription (11% for the total market).

The study also tracked a dramatic shift in how video is accessed in Latinx homes. In 2016, 31% of Latin homes accessed video only via an MVPD subscription versus 4% today. Meanwhile, the number of Latinx homes who only had streaming services rose from 6% in 2016 to 50% in 2025 and the homes with both MVPD and streaming services declined from 58% in 2016 to 43% in 2025.

With data highlighting the willingness of Latinx homes to subscribe to video services, making them an important block of customers, the Horowitz data also indicates that TV, streaming and pay TV players also need to meet the language needs of these viewers in their bundling and programming strategies.

The study found that 80% of Latinx viewers watch at least some Spanish-language programming and 61% of them report that at least half of what they watch is in Spanish.

This is most important for Spanish-dominant viewers, but bilingual and English-oriented viewers also report watching Spanish-language programming.

About 92% of those who identified as bilingual say they watch at last some Spanish-language programs as do more than half (55%) of those who say they are English dominant. Very notably, younger and older viewers all have have high rates of watching at least some Spanish-language programming.

More information can be found here.

DirecTV is making another signficant user experience enhancement to its Gemini and Gemini Air streaming devices with the launch of the new DirecTV My Apps Carousel.

The upgrade follows the rollout of the Your TV carousel on Gemini devices earlier this year.

The new DirecTV My Apps Carousel aggregates the most-watched trending on-demand and live content from popular third-party streaming apps and puts them in an easy-to-navigate, user-friendly format, the company said.

In addition to having all their favorite apps in one place, users can order the apps in the carousel based on personal preference, making this ideal for both content-bingers and sports fans alike. It is also designed to eliminate the problem of finding a user’s favorite programming, DirecTV reported.

The DirecTV My Apps carousel is available for a limited amount of existing customers at launch on Nov. 7 but will be available to all Gemini and Gemini Air users in the weeks to come.

WASHINGTON, D.C.—FCC Commissioner Nathan Simington has issued a statement criticizing the way the FCC currently regulates traditional linear TV and streaming services, arguing that the current rules “entrenches marketplace power at the expense of the consumer." He contends the FCC exerts an “uneven hand” in the media landscape with hefty “legacy rules for some, and close to zero rules for others.” 

“As the Disney / DirecTV distribution negotiation drags on, it is a moment to recognize a few truths,” Simington wrote. “One: about a third of linear network content distributed in the United States is now delivered by over the top, streaming platforms. Two: there is zero harmonization, whether in our rules or in industry practice, between network video content distribution over traditional linear MVPDs versus over the top, streaming MVPDs. Three: as is so often the case in major disputes between networks and distributors, independently owned and operated affiliates and station groups are left behind, powerless to distribute content to consumers in the way they prefer to consume it.” 

“The linear media marketplace is governed by a two-tiered system of rules—legacy rules for some, and close to zero rules for others,” he concluded. “We must balance the scales. A future Commission should take seriously the question of its own uneven hand in the media marketplace. We must either unleash the video marketplace from outdated rules or balance it with smart and targeted reforms, but what cannot persist is a system that entrenches marketplace power at the expense of the consumer.”

Simington didn’t directly discuss how the FCC should address the DirecTV/Disney carriage dispute that continues to blackout Disney’s ESPN, Disney-owned stations and other Disney networks for DirecTV satellite and streaming customers. But DirecTV did issue a statement praising the statement and calling for reform of regulations governing TV and video markets. 

DirecTV has filed a complaint with the FCC regarding Disney’s negotiating tactics.

The FCC has been exploring ways to address blackouts over carriage disputes. 

This summer, the FCC said it is is seeking public comment on whether the commission should require cable and satellite pay-TV providers to refund subscribers who face programming blackouts on their cable or satellite television subscription. 

In its “Customer Rebates for Undelivered Video Programming During Blackouts” NPRM, the FCC took note of the increasing rate of local TV station blackouts between station groups and pay-TV providers. The release of the NPRM was the second of two proposals targeting blackouts FCC Chairwoman Jessica Rosenworcel previewed last fall; the first proposal targeting reporting rules for blackouts was dropped late last year. 

But there is little agreement in the TV industry how the unequal treatment of streaming media and traditional TV can be addressed. Station group owners would like to see some players subject to increased regulations by having virtual MVPDs like Sling TV reclassified so they operate under the same rules as traditional MVPDs like Charter. This would allow stations to directly negotiate with vMVPDs for retrans fees and, they say, increase the funding for local news. 

That proposal is opposed by broadcast networks and their owners who currently handle those negotiations.

FCC Chair Jessica Rosenworcel has indicated that the FCC lacks the power to reclassify vMVPDs without Congressional action.  

WASHINGTON, D.C.—The FCC has issued an order that would reduce regulatory fees for broadcasters for the second year in a row. The decision follows a major push in recent years by the NAB and state broadcasting association to reduce the regulatory burden on stations. 

Like FY 2023, the FCC calculated regulatory fees for TV stations based on population but reduced the rate to $0.006598. This is down “from the $.007799 per-person-served used for FY 2023 TV regulatory fees,” according to the Common Law Center Blog, which also noted that “Some additional shifts will be caused by FY 2024 fees being the first to incorporate 2020 U.S. Census data into these calculations.”

According to the order issued Sept. 6. the FCC is expecting revenue from the category of digital television of $23,363,518 in FY 2024, down from FY 2023 revenue estimate of $25,463,735. 

Radio will also see a decline in rates by about 6% according to Radio World.  

Overall, FCC has a revenue requirement of $390,192,000, the same as FY 2023, that needs to be covered by regulatory fees. In contrast to broadcasters, cable TV operators will get a rate hike. They will pay $1.27 per subscriber in FY 2024, up 3.24% from FY 2023 according to Policyband. 

While fees are declining for broadcasters, the FCC denied requests by the NAB, state broadcasters, pay TV providers and others that might have further lowered rates.

Once again, the FCC did not move to include YouTube TV and other streamers in its rate calculations even though YouTube TV is now the fourth largest operator with 8 million subs. 

The FCC also rejected a proposal by state broadcasters that the Commission adopt new regulatory fee categories for broadband Internet access service providers and manufacturers of equipment that use spectrum on an unlicensed basis.

In FY 2024, the FCC is also discontinuing three relief efforts to help broadcasters. Those three relief efforts were adopted during the pandemic and continued into FY 2023. The NAB and state broadcasters had pushed the FCC to continue them indefinitely. 

The Full Order can be found here.  

WASHINGTON, D.C.—Federal Communications Commission chairwoman Jessica Rosenworcel is calling on the FCC to take action to improve customer service for consumers with broadband, phone and cable services. 

Rosenworcel has shared with her fellow commissioners a Notice of Inquiry that, if adopted, would seek information on ways to ensure that consumers have appropriate and efficient access to customer service resources when working with their phone, cable and broadband providers.  

“Consumers deserve the ability to resolve problems quickly and easily, in a way that works for them, not just what benefits the company’s bottom line,” said Chairwoman Rosenworcel.  “That’s why we are seeking information on how to promote efficiency in customer service in the telecommunications industry.  Through this effort, we want to explore solutions to take some of the pain out of routine customer service problems and pass along cost savings to consumers.”

The Notice of Inquiry would seek comment on a number of related topics including, but not limited to: 

• Simple cancellation; 
• Access to live representatives;
• Establishing uniform requirements regarding installations, outages, and service calls; 
• Automatic renewal of service or price increases; 
• Special considerations for people with disabilities, and more.

DALLAS—As many streaming services and video distribution companies struggle to expand their reach and develop profitable offerings, a new white paper from Parks Associates and JW Player (JWP) highlights the increased complexity of a video landscape and the ongoing decline of traditional TV.   

The survey found that 67% of consumers watch social video and 50% watch free ad-supported video. But only one-third watch pay TV, and 14% use an antenna to watch over-the-air broadcast. 

In addition, 65% of U.S. internet households report watching video on a mobile phone, a significant increase from ten years ago, when just 30% regularly watched video on a mobile phone.

The research, “Video Delivery: Maximizing Efficiency and Monetization”, addresses the challenges of managing content delivery, user engagement, and content monetization with a fragmented tech stack. In addition, the research addresses how operations can be streamlined for cost reduction, mitigation of operational breakdowns, and faster output of content in a variety of formats to diverse platforms.

"The video streaming business is in a transformative stage," said James Burt, senior vice president of broadcast solutions for JWP (JW Player). "It's full of requirements that change to align with shifts in viewer consumption trends. Streaming management is also technically complex, with broadcasters struggling to balance operational efficiencies with innovation and growth. Yet there are more viewers using digital platforms to consume content than ever before. Streaming companies must review their technology, operations, and productivity and make adjustments to create economies of scale and improve ROI."

These efficiencies are critical given the fragmented market and new mobility around video viewing -- televisions, smartphones, tablets, laptops, exercise equipment, and smart displays are all options today for video consumption, creating a more complex environment for streaming providers to operate, the researchers reported. 

"In the early days of streaming, services were focused on building subscriber bases through low fees, ad-free programming, and high-quality original content," said Sarah Lee, research analyst, Parks Associates. "Now, to fully monetize these efforts, they need to deliver a consistent, high-quality viewing experience that goes across all platforms."

The streaming industry has transitioned to more advertising-based models, to bring in additional revenue alongside subscriptions. Parks Associates' consumer research finds 50% of people who consume video on a viewing device (TV, computer, tablet, or phone) watch a free, ad-supported service (FAST) or ad-based video on-demand service (AVOD) at least once a week. The ads are an equally important part of the experience, as consumers expect ads to be relevant, original, and appropriate to the viewing platform.

"To preserve competitiveness and optimize operations, advertisers and content providers must acknowledge the necessity of investing in modern strategies and technologies that allow for proactive rather than reactive pivots," Lee said.

TORONTO—Rogers Communications has signed a 10-year agreement with Comcast to bring the latest Xfinity products and technology to Canadians. 

As part of the agreement, Rogers will be deploying a new streaming device powered by Comcast’s Entertainment OS operating system for streaming devices and smart TVs as well as new connectivity technologies and an expanded suite of home security products and features that have been developed by Comcast and Xfinity.

The agreement builds on an existing tech partnership between Rogers and Comcast, which was already supplying pay TV and broadband technologies to Rogers. The new agreement would further expand the use of Comcast’s devices and technologies, which are already used on Comcast's systems and are licensed to other operators like Cox Communications.  

“Our partnership with Comcast builds on our legacy of bringing Canadians the best networks, entertainment and services in the world,” said Tony Staffieri, president and CEO, Rogers Communications. “Canadians want to be connected to the best entertainment, anywhere, without interruption and we’re proud to partner with Comcast to make this a reality.”

As part of this agreement, the latest broadband, smart home and connectivity products available to Xfinity customers will be coming to Canada through Rogers starting later this year. 

"As a world leader in converged experiences inside and outside the home, this platform will make it easy and simple for Rogers’ customers to connect to what they love with a seamless experience, whether on the big screen in their home or their smartphone on the go,” added Staffieri. 

"Building on our nearly decade-long partnership with Rogers, we’re thrilled to deliver the next-generation of our incredible entertainment and connectivity products, like Entertainment OS and the latest gateways, to millions of customers across Canada,” said Dave Watson, chief executive officer of connectivity and platforms, Comcast. “Now, with the addition of these new products and services, even more customers in North America will be able to take advantage of Comcast and Xfinity’s innovative technologies.”

In announcing the agreement to supply a new device powered by Entertainment OS, the companies noted that the average Canadian subscribes to nearly twice as many streaming apps than five years ago and broadband data usage at Rogers has grown 200% in the same period. 

New research commissioned by Rogers also found that the majority of Canadians (55%) say the number of streaming apps is overwhelming. About half (50%) say searching for this content is time-consuming and admit they sometimes can’t find the show or sporting event they want to watch. The study also found accessing all streaming apps on one platform is the most appealing TV feature.

The new devices would help address those issues, simplifying the access to apps and content, the companies said. The new Entertainment OS powered platform will bring live sports, entertainment and news, on-demand, and streaming apps into one, simple view so customers spend more time watching and less time searching with the award-winning voice remote and integrated interface. 

In addition, Comcast will be supplying technologies based on its 10G Internet efforts. Through this agreement, Rogers will offer its customers the latest gateways developed by Comcast, enabling them to experience 10G technologies, like multi-gigabit speeds, ultra-low lag and even better reliability. 

Rogers will also be the first internet provider in Canada to offer a product designed to maintain connectivity when a storm hits, trees are down, or a customer experiences a local outage. Dubbed Storm-Ready WiFi to Xfinity customers in the U.S., the device is equipped with cellular backup and a rechargeable battery to keep customers up and running for hours. When the power goes out, the customer’s network automatically transitions to cellular back-up so they can continue to use of the Internet. The device also doubles as a WiFi extender to deliver a strong WiFi signal to those hard-to-reach corners of the home. 

Building on the existing Self Protect service available to Rogers’ customers, Rogers will soon launch new home security hardware, including sensors, to complement the existing options of cameras and doorbells, with the added benefit of on-demand emergency dispatch at the touch of button. 

Commercial details will be announced as products and services are made available, starting later this year, the two operators said. 

DALLAS—Nearly half of pay-TV subscribers are interested in using their TV to control smart home control and security features, according to a new survey from Parks Associates.

In its new report, Video Services: Shifting Demand, which surveyed approximately 8,000 U.S. households, 46% of pay-TV subscribers find emerging home control and interactive features, provided through their TV service, “appealing or very appealing.” 

"This data highlights a significant interest in smart home technology integration within the pay-TV market," said Elizabeth Parks, President and CMO, Parks Associates. "The home ecosystems continue to overlap, creating new opportunities to expand control and enhance the user experience. Consumers expect and want more interconnected and technologically advanced home entertainment systems."

"Video Services: Shifting Demand" details shifting consumer preferences, with historical trending data on adoption, satisfaction, and churn for pay-TV and streaming services. It also details top causes of service churn and consumer receptivity to new service features and retention incentives.

The most popular feature—which garnered 66% support among subscribers—is the ability to stream content from an online video service via a pay-TV service, with 49% ranking it "very appealing." This type of bundled offering would enhance the value of pay-TV services by simplifying the navigation process for its users, Parks said.

Most major pay-TV providers like Comcast's Xfinity Home and Cox's Homelife Smart Home offer home security services but not via their pay-TV services. Others, like Charter, for example, abandoned its smart home service several years ago, opting instead to partner with services like Ring and Abode.  

Many television manufacturers, such as Samsung and Roku, offer compatibility with smart home devices, but having this feature through the pay-TV service can offer a new level of convenience for the household, Parks said, adding that such appeal is high particularly among households with a security service—65% find home control through their pay-TV service appealing.

"The interest in connected home services opens up new markets and opportunities for partnerships between traditional pay-TV providers, tech companies, and home automation system manufacturers," Parks said. "These collaborations will lead to innovative service bundles, combining entertainment, information, and home management in new and valuable ways."

After smart home management, the remaining most popular enhanced features for pay-TV services include cloud gaming, T-Commerce, interactive polls, and sports betting.

The rate of cord cutting has increased over the past five years according to a new report from Leichtman Research Group, which found that only 64% of TV households nationwide now have some form of pay-TV service. The percentage of TV households that have a live pay-TV service (via cable, satellite, Telco, or internet-delivered vMVPD) is down from 78% in 2018, 86% in 2013, and 87% in 2008.

It’s not just younger viewers that reflect the downturn though. In TV households with viewers 45 years and older, that percentage has fallen to 70%, compared to 88% in 2013. For younger households, adults ages 18-44, only 56% have a pay-TV service compared to 83% a decade ago. 

These findings are based on a survey of 1,769 households from throughout the United States, and are part of a new LRG study, Pay-TV in the U.S. 2023.  This is LRG’s twenty-first annual study on this topic.

Other related findings include:

• 48% of those that moved in the past year do not currently have a pay-TV service – a higher level than in any previous year
• 42% of renters do not have a pay-TV service – compared to 33% of homeowners
• 33% of non-subscribers last had a pay-TV service within the past three years, 37% last had a pay-TV service over three years ago, and 30% never had a pay-TV service
• Among those that never had a pay-TV service, 63% are ages 18-34, compared to 24% of former pay-TV subscribers
• The mean age of traditional pay-TV subscribers is 49.3 – compared to 42.5 among non-subscribers, and 40.8 with vMVPD-only
• Among all pay-TV subscribers, the mean reported spending per month is $112.70 – 5% higher than the mean monthly spending in 2018

“The percent of U.S. TV households with a live pay-TV service waned over the past decade, with a more precipitous decline over the past five years,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc.  “The penetration of pay-TV remains lowest among younger adults and the categories that they tend to populate, including movers and renters.  Today, 56% of ages 18-44 have a pay-TV service, compared to 83% a decade ago.”

The FCC is following up on its promise it made several months ago to require that pay-TV operators provide clear, concise and accurate information on consumer’s cable and satellite TV bills. 

The new customer service protections would require cable and satellite TV companies to specify the “all-in” price clearly and prominently for video programming service in their promotional materials and on subscribers’ bills. 

Specifically, cable and DBS providers would be required to state the total cost of video programming service clearly and prominently, including broadcast retransmission fees, regional sports programming, and other programming-related fees, as a prominent single line item on subscribers’ bills and in promotional materials.

“Consumers who choose a video service based on an advertised monthly price may be surprised by unexpected fees related to the cost of video programming that raise the amount of the bill significantly,” the commission said in its Notice of Public Rulemaking issued this week. “These fees, with names like broadcast TV fee, or regional sports programming surcharge, are listed in the fine print as “fees” or “taxes and surcharges,” separate from the top-line listed service price and can result in a bill that is substantially more than the advertised price. This categorization can be potentially misleading and interpreted as a government-imposed tax or fee, instead of a company-imposed service fee increase. This practice can also make it difficult for consumers to compare the service prices of competing video service providers.  

“This all-in pricing proposal is intended to give consumers a transparent and accurate reflection of their subscription payment obligations and eliminate unexpected fees. It also seeks to provide consumers with the ability to comparison shop among competing cable operators and DBS providers, and to compare programming costs against alternative programming providers, including streaming services,” it added. 

The commission is also seeking public input on whether to expand the requirements of this proceeding to other types of multichannel video programming providers (MVPDs) and whether it has the authority to do so.

NCTA-The Internet Association said “as cable providers operating in a highly competitive market for video services, we take seriously our responsibility to operate transparently and provide consumers with relevant information related to the cost of services, including those than may vary among households or region. We look forward to reviewing the NPRM and participating in this proceeding."

ACA Connects, which represents small and midsized US operators said that it is also "committed to transparency." 

"As this proceeding unfolds, we are eager to provide and review the evidence and examine the root causes of ever-increasing prices for video programming that our Members distribute, as well as ensure that any new requirements do not have the unintended effect of making video prices more opaque or confusing for subscribers," said ACA Connects President and CEO Grant Spellmeyer.

While streaming has gotten the lion’s share of attention for the past several years, TV viewers are demonstrating that it’s the quality of the content that drives them to watch a particular show, not the destination. That’s the conclusion of Hub Entertainment Research’s annual “Conquering Content” that surveyed the various ways TV consumers discover and watch TV shows.

The survey has some good news for those lamenting the decline of traditional MVPD linear TV services. According to the survey, the percentage of viewers watching live TV from a traditional MVPD service has jumped 6 points in 2022, to 21%, after reaching a low of 15% in 2021. Hub attributes this to the fact that, of the 10 favorite shows viewers named most frequently, four of them—including three of the top four—are available on live TV: Yellowstone, House of the Dragon, Ghosts, and NCIS.

Hub adds that trend lines showing the rate of viewers who responded that their favorite TV show is on a streaming service opposed to those who cite a traditional MVPD service are flattening. Although 75% of survey respondents said their favorite TV show is online, that proportion is identical to 2021; additionally the proportion watching their new favorite show from an MVPD set-top box has increased two points, from 21% in 2021.

So much of how viewers find their favorite shows has changed over the years since streaming became more popular. Traditionally, promotional spots during commercial breaks served as the most popular way viewers discovered new shows but in the streaming world, that responsibility falls onto trailers.

In the survey, 63% said they were more likely to watch a new show if they could watch a trailer first and among those who discovered a show from a trailer, 78% said they discovered it from a trailer that auto-played without them deliberately selecting it, up nearly 20 points since just last year.

Netflix remains the top streamer of choice, according to the survey, however the gap between viewers who watch their favorite shows on Netflix vs. those who watch their favorite shows on a traditional MVPD pay TV service is declining, now at 8 points; 4 points when compared to all five of what Hub identifies as the  “Big 5 SVODs”: Netflix, Amazon Prime, Hulu, Disney+, and HBO Max. 

Viewers continue to clamor for an easier way to find new content, according to Hub.  The proportion who agree (strongly or somewhat) that they want a “universal listing to find shows from any source” has always been high in Hub’s survey, but it’s even higher in 2022: 61%, up 6 points since last year.

“Insert overused expression here: “content is king,” etc. But cliché or not, it’s clear from these results that viewers will happily go to whatever platform has exclusive rights to the most popular TV shows and movies du jour,” said Peter Fondulas, Principal at Hub and co-author of the report. “Over the past few years, those shows have been increasingly offered by streaming services. But as franchises like Yellowstone and Game of Thrones demonstrate, streaming does not have a necessary monopoly on buzz-worthy content.”

Let’s make it clear: Pay TV is not going anywhere soon. But as TV manufacturers strive to put all available services in one place, viewers are less inclined to want to manage yet another piece of hardware. A set-top box (STB) becomes just another tree in the technological jungle of cables, boxes and multiple remote controls. Moreover, it is very expensive for operators to subsidize and carry the costs associated with STBs. Eventually, the old way of paying back the extensive costs of STBs will be obsolete.

Rather than spelling doom for the pay-TV industry, this change in subscribers’ needs presents an opportunity to follow an entirely new and scalable path for operators. In fact, pay-TV operators are in the prime position to become super aggregators themselves, removing the need for any external devices. By taking ownership of the smart TV, they can maximize capex savings, cut the competition short, and vastly improve the subscriber experience. 

To begin, this article will outline why other solutions—like TV apps—are just intermediate steps or compromises with significant limitations. Then, it will explain how an operator-branded TV can put pay-TV operators back in control and on an accelerated path for growth.

The Constraints of TV Apps
An alternative to the STB is developing an app that viewers can download to their smart TVs and, with a subscription, begin watching content immediately. Obviously, this means neither the viewer nor the operator will need any additional hardware, in turn causing little operational and financial stress for both parties. TV apps may seem like an easy win, and for some operators, they are.

Yet this choice replaces a hardware problem with a competition problem. Whenever the viewer turns on the TV screen, this newly created app competes with an array of other downloaded apps, including other streaming platforms. Effectively, the app undermines the unified entertainment experience that pay TV uniquely provides.

 Because they don’t have access to the whole device and can’t control the overall experience, operators cannot aggregate other OTT apps and TV channels within their smart TV app. Even if the app appears to be on the same surface level as the other apps, which is not guaranteed, viewers may decide it’s one subscription too many, and they may eventually cancel.

An additional drawback of TV apps is that they have to take into account the business constraints imposed by the provider of the underlying platform OS. This may involve having to share revenue and negotiate for home page placement. At the same time, the operator only gets a limited view of subscribers’ viewing habits, data that is vital for service and revenue optimization.

While seeming straightforward at first, this option may not provide a great return on investment for the pay-TV service—especially since the operator has replaced the cost of STBs with a weaker value proposition.

OpApps: A Better but Limited Solution
An HbbTV OpApp offers an alternative to smart TV apps. HbbTV (Hybrid broadcast broadband TV) is both an open industry standard and an initiative to promote the mixture of broadcast and broadband services on TV. The HbbTV Association initially developed the OpApp (Operator Application) specification in response to industry demands for a way to deliver pay TV to existing TV devices without the need for an additional STB. The first commercial OpApp launched on a TV set in 2019, and was followed by additional deployments, mainly in Europe. 

HbbTV has defined a Privileged OpApp variant that functions like a special, more powerful application, allowing the operator to take over some key parts of the TV system user interface, typically the linear TV channel list, the guide, and potentially an on-demand and search portal linked to those. 

Privileged OpApps run independently of smart TV apps and are either embedded in the TV (with help from the TV manufacturer) or installed onto the system during first time setup, or afterward via a decryption device, such as a Common Interface module. Once they’re loaded, Privileged OpApps allow operators to establish their user experience, with viewers accessing the operator UI every time they use the TV.

Unfortunately, there are a few major problems with this option. HbbTV has not yet been deployed in all countries, particularly in some parts of Europe and the United States, yet it is required to run OpApps. This fact discourages the idea of Privileged OpApps as a universal solution for pay-TV operators, at least for the time being. 

Additionally, Privileged OpApps can lack features that would otherwise be available on a dedicated STB, depending on the variant of OpApp the operator chooses and the level of collaboration with the TV manufacturer.

This may not mean much for consumers, who are happy to forgo all the extra hardware if it means they can still have an STB-like experience. But for the pay-TV operator, OpApps put them at a technical disadvantage, as there may still be parts of the TV experience that they can’t control.

The All-Around Best Solution: Operator-Branded TVs
Pay-TV operators have a well-respected brand and can work with a manufacturer to build their own branded TVs, selling them directly or through retail without taking on the liability of subsidizing a TV product for existing and new customers. This approach gives operators complete control over the specifications and the system UI, while in turn offering all the standard features that subscribers look for in a TV. 

A branded TV also puts the operator in a position to access the revenue streams that TV OS providers are increasingly able to extract owing to their gateway position in the home. To set the branded TV further apart from the competition, operators can  then offer an incentive at the time of purchase, such as a free subscription for the first few months, or a mobile phone bundle in the case of multiplay providers. 

While the concept of an operator-branded TV is nothing new, technology has advanced far enough in the last few years to make the venture financially attractive. Off-the-shelf TV ODM hardware provides a better economy of scale compared with STBs, and yet the device still retains all the features—including device management and performance monitoring that operators rely on to maintain the highest levels of quality of service—without making the subscriber wait to receive another piece of hardware in the mail. Plus, the device is already built around the pay-TV service, so the UI is not only easy for the subscriber to use but also provides exclusive access.

In the future, there will be even more options for operator-branded TVs. Direct retail sales of branded TVs will allow operators to make a margin on selling hardware. Operators can compete with other smart TVs by offering a compelling product that aggregates video services (i.e., linear, OTT, VOD) in a more consistent way than smart TV manufacturers alone can do. 

An operator-branded TV is appealing to many consumers looking for a smart TV that is easy-to-use, with a good quality-to-price ratio and all the services they want already built-in. The majority of consumers don’t want to investigate complex technical specifications and compare all the smart TV brands, hardware models, and special offers available on retail shelves. This need for simplicity is one that only an operator-branded TV can satisfy.

In Conclusion
Operator-branded TVs give pay-TV services more prominence than an app and more control than a Privileged OpApp. They also do away with the extra hardware of a STB while providing potential for cross promotion of products and services using the capabilities of the UI, and offering new sources of revenue from retail purchases, rentals, and subscriptions bundles. 

With an operator-branded TV, pay-TV operators can seize control of the smart TV experience and become super aggregators, driving new subscriber growth and boosting revenues without bearing the cost of additional STB hardware.

Despite the increase in cordcutting, drawing viewers away from pay-TV, interest in live news and sports—a staple of traditional linear TV—remains high among older, wealthier viewers, according to a recent study from Leichtman Research Group

When asked the importance of various programming genres, overall, 49% of adults rated news as very important (8-10) and 41% rated sports as very important, LRG said. While neither of these are the highest rated genre overall––that distinction goes to movies at 69%––there are significant differences in the importance of news and sports to pay-TV subscribers versus nonsubscribers. 

The study found that:

• 56% of pay-TV subscribers rate news as very important, compared to 32% of non-subscribers
• 49% of pay-TV subscribers rate sports as very important, compared to 21% of non-subscribers

The rated importance of these genres is also higher among those in the demographic categories that (unsurprisingly) are typically more likely to get a pay-TV service.

News is more important among older age individuals, and in higher income households: 

• 66% of ages 55+ rate news as very important, compared to 48% of ages 35-54, and 32% of ages 18-34 
• 57% with annual household incomes >$75,000 rate news as very important, compared to 45% with household incomes <$75,000

Sports is more important in higher income households, as well as among men:

• 52% with household incomes >$75,000 rate sports as very important, compared to 39% with household incomes of $30,000 - $75,000, and 27% with household incomes <$30,000
• 49% of men rate sports as very important, compared to 34% of women

Going forward, these genres will continue to play important roles in balancing the legacy model with direct-to-consumer offerings. However these options are not mutually, LRG added, as consumers will continue to get the services and content that best serve their households’ needs and budgets.

DURHAM, NH—The largest U.S. pay TV operators saw fewer subscriber losses in 2021 than in 2020, according to Leichtman Research Group.

The research firm reported that pay-TV providers in the U.S. representing about 93% of the market lost about 4,690,000 net video subscribers in 2021, compared to a pro forma net loss of about 4,870,000 in 2020.

The top pay-TV providers now account for about 76.1 million subscribers, with the top seven cable companies having 41.3 million video subscribers, other traditional pay-TV services having over 26.8 million subscribers, and the top publicly reporting Internet-delivered (vMVPD) pay-TV services having 7.9 million subscribers.

Key findings for the year include:

• Top cable providers had a net loss of about 2,695,000 video subscribers in 2021, compared to a loss of about 1,940,000 subscribers in 2020;
• Other traditional pay-TV services had a net loss of about 2,890,000 subscribers in 2021 compared to a loss of about 3,845,000 subscribers in 2020;
• Top publicly reporting vMVPDs added about 895,000 subscribers in 2021, compared to a gain of about 915,000 subscribers in 2020
• Traditional pay-TV services (not including vMVPD) had a net loss of about 5,585,000 subscribers in 2021, compared to a net loss of about 5,785,000 in 2020

“While the pay-TV industry continued to lose subscribers, net losses in 2021 were fairly similar to those in recent years,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc.  “In 2021, the top pay-TV providers had a net loss of about 4.7 million subscribers, compared to a pro forma loss of about 4.9 million subscribers in 2020, and 4.1 million in 2019.”

DURHAM, N.H.—The largest pay-TV operators in the U.S. continued to lose video subscribers in the first quarter of this year, with MVPDs representing about 95% of the market reporting net sub losses around 1,895,000 video subscribers in Q1 2021, according to the Leichtman Research Group Inc.

The losses were similar to declines seen in early 2020, when pay-TV operators  lost 1,955,000 subs in Q1 2020. 

With the losses, the largest U.S. pay-TV video subscribers now have about 78.7 million subs. This includes the top seven cable companies with 43.1 million video subscribers, other traditional pay-TV services like Dish, Verizon and AT&T with 28.9 million subscribers, and the top publicly reporting internet-delivered (vMVPD) pay-TV services like Hulu and Sling with 6.7 million subscribers. 

“Pay-TV net losses of about 1.9 million in Q1 2021 were similar to the net losses in Q1 2020,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group (LRG).  “Over the past year, top pay-TV providers had a net loss of about 4,790,000 subscribers, compared to a loss of about 5,125,000 over the prior year.”

Among the different sectors, cable video customer declines accelerated slightly to a net loss of about 775,000 video subscribers in Q1 2021, up from about 595,000 subscribers in Q1 2020. The Q1 2021 losses among the top cable operators were more than any previous quarter, LRG reported. 

Virtual MVPDs also continued to struggle, with a net loss of 255,000 subs in Q1 2021, up slightly from 210,000 a year ago. 

AT&T Premium TV, which includes DirecTV, U-verse and AT&T TV, once again saw the largest losses of any operator, with a drop of 620,000 video subs in the quarter, followed by Comcast, with 491,000 fewer subs in Q1 2020. 

LONDON—Ten years after hitting its peak, global pay-TV revenues are expected to be at their lowest since prior to 2010, with an estimated total revenue of $143 billion by 2026. The numbers come from Digital TV Research’s “Global Pay-TV Revenue Forecasts” report.

In 2016, global pay-TV revenue was at $201 billion. That has decreased nearly $30 billion in recent years, as global pay-TV revenue was at $173 billion across 138 countries in 2020. Now, Digital TV Research estimates a drop of another $30 billion between 2020 and 2026, when the projected global pay-TV revenue is $143 billion.

This drop would occur even as the total number of global pay-TV subscribers is expected to have a net gain of 15 million subscribers by 2026.

For 2021 alone, Digital TV Research forecasts that global pay-TV revenue will drop by about $8 billion, with 2021 global pay-TV revenue estimated to be nearly $165 billion.

The largest drop in revenue is coming from the U.S. After hitting a peak of $104 billion in 2015, the U.S. dropped to $80.3 billion in 2020. It is projected to lose another $6 billion in 2021 to $74.4 billion, and by 2026 see its pay-TV revenue fall to $57.4 billion.

Most other countries—77 of the 138 covered by Digital TV Research—are projected to also see less pay-TV revenue by 2026. One that is expected to see growth is India, which is projected to grow from $5 billion in 2020 to $5.6 billion in 2026.

In addition, global satellite TV revenues are expected to drop $16 billion, digital cable down $12 billion and analog cable down $2 billion.

For more information, visit Digital TV Research’s website.

LONDON—The trend of subscriber losses is not expected to change for the pay-TV industry in the U.S. anytime soon. According to a new projection from Digital TV Research, between 2020 and 2026, the U.S. will have a net loss of 16 million pay-TV subscribers, resulting in 63.9 million subscribers by 2026.

Of the 42 countries that are estimated to suffer a net loss over that period, the U.S. is expected to take the biggest hit. However, the overall global pay-TV market will increase from 2020-2026 by 15 million, per Digital TV Research, with 92 countries projected to see a growth of pay-TV subscribers.

With the additional 15 million subscribers, global pay-TV subscriptions will reach 1.02 billion in 2026. China will lead the way with 317.5 million, even though it is one of the countries that will lose subscribers between 2020 and 2026, with OTT platforms helping to push 10 million away from pay-TV subscriptions. 

India is expected to be the largest growing country, adding around 21 million subscribers for a total of 180.7 million in 2026.

The 1.02 billion subscribers in 2026 will consist of 378 million IPTV subscribers (up 63 million from 2020), 412 million cable TV subscribers (down 46 million), 203 million satellite TV subscribers (down 8 million) and 25 million pay DTT subscribers (up 6 million).

For more information, visit www.digitaltvresearch.com.  

BOSTON—To keep up with all the TV content out in the world today, users are relying on more TV sources than ever before. According to the latest report from Hub Entertainment Research, the average consumer uses 5.7 different sources of TV content.

The sources that consumers are using range from traditional pay-TV, streaming services and over-the-air reception through an antenna. The 5.7 average that Hub reports for 2021 is nearly one service higher than in 2020 (4.8) and nearly double what it was prior to the Covid-19 pandemic in 2019 (3.7).

Streaming, unsurprisingly, is a big reason for the rise in the average. Nearly eight in 10 users now use a streaming TV service, per Hub. That number is 19 percentage points higher than those who have a traditional pay-TV subscription. Traditional pay-TV has actually dropped by seven percentage points since 2020.

However, there was only a two percentage point increase in consumers saying they started using a streaming service compared to last year. What is driving the growing gap between streaming and pay-TV is the increase in use of multiple streaming services and greater adoption of free, ad-supported services.

More than half (59%) of all TV consumers say they use two or more of the top SVODs (Netflix, Amazon Prime Video, Hulu, Disney+ or HBO Max). That is up eight points from 2020. Use of AVOD services (Roku Channel, Pluto TV, Peacock) is also up eight points to 48% of consumers.

Some consumers are expecting to continue to add to their available services. One in five (21%) say they plan to sign up for a new service in the next six months. Majority of those planning to add will do so without cutting another service. Those with four or more services are actually more likely to add another subscription without replacing anything, per Hub.

In terms of satisfaction, about 52% of consumers says their bundle of services meet their needs “very well,” while 42% said “somewhat well” and just 6% said “not at all well.”

For more information, visit Hub’s website. 

Despite a recent projection that cord cutting will accelerate significantly over the next 24 months, the top five publicly traded pay-TV companies lost 22.3% fewer video customers in Q1 than they did in the first three months of 2020. 

Comcast, Charter Communications, AT&T, Dish Network and Verizon combined to lose 1,561,000 video customers in Q1 vs. 2,011,000 in the same period of 2020. 

For the most part, video losses for each of these companies were worse, or largely the same, save for one operator, AT&T. That telecom lost 897,000 customers across its DirecTV satellite and U-verse “premium” platforms in the first quarter of last year, and another 138,000 from virtual MVPD AT&T TV Now. Most of the losses came in satellite TV.

In January, February and March of 2021, AT&T lost a combined 620,000 across DirecTV, U-verse and AT&T TV—the latter service, launched in April of last year, having subsumed AT&T TV Now. AT&T is in the process of spinning off a portion of its pay-TV assets to private equity firm TPG. 

Among cable operators, Comcast saw its Xfinity TV losses accelerate to 491,000 vs. 409,000 in the first quarter of 2020, while Charter Communications saw losses expand from 70,000 to 138,000, first quarter vs. first quarter. 

In satellite, Dish Network saw flat linear customer recession of 132,000 users, but experienced improved subscriber losses for its Sling TV vMVPD, which lost only 100,000 customers vs. 280,000 in Q1 2021. 

Among telcos, Verizon’s 82,000 lost Fios TV souls were largely flat with the 84,000 shed in Q1 2020, but the company retracted to overall customer levels (3.7 million) not seen in 10 years.

This analysis leaves out a range of smaller cable companies, Altice USA, Mediacom and Cable One.  Also not included are major virtual MVPD operators Hulu + Live TV and YouTube TV. 

ENGLEWOOD, Colo.—Dish Network has shared its first quarter 2021 financial report, which includes its pay-TV subscription numbers. Dish reported a net loss of 230,000 pay-TV subscribers in the quarter.

That 230,000 decrease actually represents a smaller churn of subscribers than Dish saw in Q1 2020, when 413,000 pay-TV subscriptions were lost. In total, Dish said it ended Q1 2021 with 11.06 million pay-TV subscribers, including 8.69 million Dish TV subscribers and 2.37 million for Sling TV.

Despite the dip in pay-TV subscribers, Dish reported a total revenue of $4.5 billion, up from $3.22 billion for the same period in 2020. Net income for Dish was $630 million in Q1 2021, up from $73 million in Q1 2020, per Dish.

For more information, visit ir.dish.com. 

NEWTON, Mass.—Streaming is poised to overtake pay-TV in terms of consumer spending as soon as 2024, according to a new report from Strategy Analytics.

The “U.S. Subscription TV Forecast” from Strategy Analytics details that pay-TV services fell by 8% in 2020, totaling $90.7 billion. That decrease is expected to continue, with pay-TV spending hitting $74.5 billion in 2023.

Streaming, meanwhile, is on the rise. In 2020 alone it increased 34% to reach $39.5 billion. By 2024 that number is projected to be $76.3 billion. This would mark the first time that streaming spending surpassed pay-TV.

Strategy Analytics points out that even as pay-TV viewership numbers have declined and in some cases already been surpassed by streaming, the money spent on pay-TV still exceeded that of streaming. However, as cord-cutting has become more common and streaming services more numerous, revenues are projected to shift away from legacy pay-TV.

In context, Strategy Analytics forecasts that pay-TV will account for 40% of spending on video and TV services in 2026, down from the 81% it represented 10 years earlier.

“The fact that viewers are willing to divert an ever-increasing share of their entertainment wallet away from pay TV and towards new internet-based services demonstrates that the future lies with streaming video services rather than legacy pay TV players,” said Michael Goodman, director, TV & Media Strategies for Strategy Analytics. “This is a long-term transition, but there is no doubt that the writing is on the wall for pay TV as we have known it for more than 40 years.”

For more information, read the full U.S. Subscription TV Forecast from Strategy Analytics.

NEW YORK—To predict that pay-TV subscribers numbers will continue to drop as streaming services and other direct-to-consumer services entice people to cut the cord is not a reach, but S&P Global Marketing Intelligence takes it a step further saying that the loss of pay-TV over the next few years will negatively impact the U.S. TV sector’s credit quality.

The rate of pay-TV subscription loses, while still worse than 2019 (7.3%), slowed in 2020 (7.9%), thanks in large part to a dip in the second half of 2020. However, S&P estimates subscription losses will return to the levels they were in the first half of 2020.

The cable sector is projected to see a loss rate of 6.6% of its subscriptions in 2021, which is up from 4.6% in 2020. Larger cable operators are seeing a two point increase from 3.8% to 5.8% year-over-year. Midsize (9% to 10%) and small operators (actually seeing a marginally  smaller rate of loss, from 10.8% to 10.5%) will not move the needle as much. All of those numbers are expected to remain steady into 2022.

S&P believes that this increased pace is likely to continue because the cable sector is “increasingly indifferent as to whether unprofitable customers get their video service from cable companies or a third-party service.”

Satellite’s rate of losses are expected to decrease, according to S&P, having been at 11.2% in 2020 and a projection of 10.1% in 2021 and 10% in 2022. It credits Dish’s focus on key rural subscribers, but S&P questions the long-term sustainability of this trend. Things like rate increases and churn could impact it as life normalizes.

DirecTV, meanwhile, which plays in more urban and suburban markets, has not leveled off as S&P had originally thought it might, maintaining its 15% pace of subscriber loss.

Then there’s Telco. Despite several Telcos offering cloud-based TV services, S&P estimates that its rate of subscribers losses will jump from 13.7% in 2021 to more than 38% in 2022, as many companies could be content to let their video customers churn over the next few years.

One bright spot for pay-TV in recent years has been the emergence of virtual pay-TV entrants, like YouTube TV and Sling TV. Still, S&P does not see these vMVPD services as long-term solutions for pay-TV. When first launched, many of these services offered low-priced, slimmed down offerings, but they are growing to become more like traditional pay-TV packages and the prices are starting to rise in reflection of that; i.e., YouTube TV’s price hike the last couple years.

These services should be able to continue growing over the next few years, however, because they do not require any equipment fees or contracts, S&P says. They do though have a greater monthly churn and their revenue streams are more volatile because of this, as well as the fact that some people sign up seasonally depending on things like sports.

Pay-TV’s decline could accelerate if sports make a stronger push toward streaming. The NFL, as part of its most recent broadcast rights deal, gave exclusive programming to Amazon and networks like CBS (Paramount+), ESPN (ESPN+) and NBC (Peacock) will offer some of their NFL games on the streaming platforms. If or when more sports follow suit, it could hasten the cutting of traditional linear TV subscriptions.

Also, the expansion of broadband into more rural areas will help make streaming options more viable for those markets, also contributing to greater adoption of streaming services.

While certain broadcast TV elements like local TV and broadcast networks will help to keep traditional pay-TV key to many consumers, and can differ depending on the broadcast sector, the current rate of cord-cutting is an overall negative for the entire TV media sector’s credit quality, S&P concludes.

NEW YORK—With media companies pivoting to streaming, analyst Michael Nathanson of MoffettNathanson is asking if streaming is really a better business than traditional pay-TV.

His conclusion: With Netflix the only mature streaming company to use as a model, domestic streaming isn’t all that much different in terms of profit margins from low-end basic cable and premium pay networks, said Nathanson in a report.

The profit picture gets better when you look at the international opportunity, where Netflix is a strong performer. 

“Netflix’s greatest asset—and the likely Achilles’ heel of many of their competitors—is indeed their international footprint, which should drive incremental profit and ROIC into the future. Absent a truly global ambition and subscriber base, we struggle to see how many of these nascent SVOD/AVOD services will profitably scale,” Nathanson said. 

Disney and Discovery are so far the only competitors that have shown the ability to successfully build business on their content around the world, he said.

In addition to international, advertising has the potential to make streaming a stronger business—something Netflix, the leader, seems determined to avoid.

Streaming technology makes it possible for media companies to sell advertising that is better targeted and therefore get better prices per impression. 

“The shift in revenue models from linear to DTC will most likely favor programmers that have high brand identities and a buffet of fresh content choices that requires minimal third-party marketing support while driving long-term pricing power,” Nathanson concluded.

“In addition, networks that can better effectively monetize advertisers by selling against individual targets rather than broad demographic reach should ultimately find the move to be accretive,” he added. “Lastly, outside the United States, as Netflix has proven, there is a greater revenue TAM available in OTT models than previously existed in the economics of linear TV. Very few media companies aside from Disney can check all these boxes at scale.“

BOSTON—A year into the pandemic, consumers’ new habits of increased TV viewing and streaming are becoming entrenched, according to the latest Hub Entertainment Research study. Even so, things aren’t all rosy, as pay-TV is turning into the easiest service to drop amid the plethora of options available.

These statistics come from Hub’s latest “Predicting the Pandemic” research, which compared responses from three different times over the last year—July 2020, November 2020 and February 2021.

Last July, 69% of respondents told Hub they were watching more TV at that time than they did before the pandemic; the numbers were similar (70%) in November. But as of February that percentage shot up seven points to 77%, with 42% saying they watched a lot more TV than prior to the pandemic.

More consumers are also adding new services. Hub found that 44% of respondents said that they have added at least one subscription service during the pandemic, up 10 points from November 2020. Related, a quarter of respondents said that they had dropped at least one TV service; that number was at 18% in July 2020.

Per Hub’s research, a good chunk of those dropped services were likely pay-TV. Since November 2020, cable, satellite or telco TV services fell by 9 points, with 62% of TV consumers saying they subscribe to such a service. More people are opting to go with vMVPD services (YouTube TV, Sling TV, etc.) to access local and cable channels, as the percentage of vMVPD subscribers has increased from 11% in February 2020 to 21% in February 2021.

Consumers’ mentality around pay-TV has also shifted over the last year. In July 2020, 69% of consumers said that they would have still cut their pay-TV services if the pandemic had not happened. But as of February, that number has increased to 89%.

Meanwhile, all the major streaming platforms (Netflix, Amazon Prime Video, Disney+, Hulu and HBO Max) have seen steady increase in subscription numbers. HBO Max has seen a significant increase in subscriptions since November 2020, which HUB attributes to its decision to release 2021 Warner Bros. movies the same day as they debut in theaters. However, HBO Max is also the service that most consumers would consider dropping post-COVID.

In addition, more people are now using AVOD streaming services, growing from 34% in February 2020 to 58% in February 2021.

“What’s been most interesting to us in our pandemic-related research has been trying to determine which pandemic-induced changes in TV behavior will persist once life begins to return to normal,” said Peter Fondulas, principal at Hub and co-author of the study. “This wave of the study strongly suggests that Americans have grown more than just accustomed to the TV viewing adjustments they’ve made during the pandemic, and are ready to embrace a new, streaming-centric normal.”

The full “Predicting the Pandemic” report is available on Hub’s website. 

WASHINGTON—A good chunk of people around the world reacted to a year of stay-at-home and quarantine orders by signing up for streaming services, resulting in the total number of online video subscriptions jumping to 1.1 billion at the end of 2020, according to the Motion Picture Association’s annual THEME report.

MPA’s categorization of online video subscriptions specifically refers to streaming services, like Netflix and Disney+. In 2020, 232.1 million new subscriptions were added across the world, a 26% increase from 2019. Meanwhile, cable subscriptions decreased by 2% in 2020, dropping to 530.7 million globally.

In terms of revenue, the pay-TV subscription market, which excludes online video in the MPA report, was $233.1 billion. Despite a decrease in subscriptions, cable actually grew its revenue by $871.4 million to $111.6 billion, keeping it as the largest subscription video market. Online video is the third largest subscription market and increased $14.3 billion (34%) in 2020.

When looking specifically at the U.S., online video subscriptions shot up to 308.6 million, an increase of 32%. Virtual pay-TV subscriptions also saw an increase, adding 12.1 million subscriptions in 2020, up 29%. Cable and satellite subscriptions both declined.

However, like the global market, cable remains the largest subscription market in terms of revenue in the U.S. Despite about a 4% decrease in subscriptions, cable’s 2020 revenue was actually on par with 2019, netting $50.8 billion. Satellite, the second largest, did see a drop in revenue, however. As a result, online video’s increase of $24.7 billion (up 35%) let it inch closer to satellite’s number two spot in the U.S. market.

MPA also reported that the amount of time for U.S. adults watching TV (live or recorded) increased for the first time since 2012, with viewing times growing by seven minutes to an average of three hours and 34 minutes. That was even higher for OTT video, increasing 71.8 minutes (up 34%), the first time MPA reported it exceeding one hour.

Approximately 80% of U.S. adults watched shows/series or movies via traditional TV services or online subscription services in 2020, the highest ever mark, according to MPA. More people reported watching TV programming via pay-TV every day (24%) than any other format, though online subscription outpaced those who said they watched TV programming “several times a week” (26% vs. 22%).

All viewing methods saw increased viewing time by U.S. adults during the pandemic, but the largest was for online video services, with 55% of adults saying their viewing time increased, a 46% growth. Pay-TV grew 36%, with 46% of adults reporting increased viewing time.

For the full 2020 THEME Report, visit MPA’s website. 

NEW YORK—Nearly 7.2 million traditional multichannel (MVPD) subscribers opted to cancel their subscriptions in 2020, according to a recent report from Kagan, an S&P Global Market Intelligence media research group.

The 7.2 million combines traditional cable, telco and satellite pay-TV services. According to Kagan, at the end of 2020, only 57% of U.S. occupied households only had a traditional MVPD service. That number is better when combined with a virtual MVPD, with about two-thirds (66.6%) of households having a traditional service and a vMVPD, though that is still down from 2019.

The growth of vMVPD helped mitigate the number of people that dropped live linear channel packages, with 2.7 million new subscribers, but it was not enough to offset traditional MVPDs losses.

MVPD losses did slow in the fourth quarter of 2020, with a total subscription loss of 1.5 million, but vMVPD did not maintain its momentum from the third quarter, per Kagan, netting 223,000.

“[T]he full year decline underscored that the impacts of the pandemic amplified cord-cutting instead of insulating an industry built around home entertainment,” said Kagan.

For more information, visit www.spglobal.com/marketintelligence. 

LONDON—From 2010 to 2020, cord-cutting emerged as a major issue for the pay-TV industry, as 27 million North American subscribers cancelled their services, according to Digital TV Research. However, while the numbers are still trending downward, the rate of cord-cutting is going to slow over the next few years.

In 2010 there were 116 million pay-TV subscribers across the U.S. and Canada with either pay satellite, IPTV or cable services. As of 2020, that number had dropped to about 89 million, including losing 6 million in both 2019 and 2020, Digital TV Research reports.

PLUS: Cord Cutting Nearly Doubled for the Big Four U.S. Pay-TV Providers in 2020

By 2026, Digital TV Research estimates that North American pay-TV subscribers will total 74 million. This would represent a loss of nearly 43 million subscribers from 2010-2026 (41 million in the U.S., 2 million in Canada), but the rate of decrease is expected to slow over the next five years.

“The worst of the cord-cutting is over,” said Simon Murray, principal analyst at Digital TV Research. “Declines will be lower from 2021, falling by 16 million in total between 2020 and 2026. ‘Only’ 5 million digital cable TV subscribers will be lost. Satellite TV will fall by 7.5 million and IPTV by 3.4 million subscribers.”

Additional findings from Digital TV Research’s report includes that pay-TV penetration from 2010-2026 will drop from 90.5% to 53.6%. Also, after pay-TV revenues peaked in 2015 at $111 billion, by 2026 they will be at $62 billion, a decrease of $49 billion.

For more information, visit www.digitaltvresearch.com.  

ENGLEWOOD, Colo.—Dish Network experienced another quarter of net losses for its pay-TV subscriptions, but according to the company’s financial report, losses were less than a year ago, and in the instance of Sling TV, subscriptions are actually on the rise.

Dish’s fourth quarter and year-end 2020 financial report shared that the company lost 133,000 net pay-TV subscribers in Q4 2020. However, that is an improvement compared to Q4 2019’s 194,000 lost subscribers. 

Dish TV’s subscriptions dropped from 8.986 million in Q3 2020 to 8.82 million. But Sling TV, Dish’s vMVPD platform, actually saw modest growth from 2.458 million subscribers to 2.47 at the end of Q4.

In total, Dish ended 2020 with 11.29 million pay-TV subscribers. That is down from where it finished a year ago—11.986 million.

As for the entire company, Dish reported $4.56 billion in revenue for Q4 2020, up from $3.24 billion in Q4 2019. For the full year, Dish earned $15.49 billion in revenue, up from 2019’s $12.81 billion.

For more information, visit ir.dish.com. 

DALLAS—Pay-TV subscribers want access to online and OTT services, however, other advanced features could help keep pay-TV subscribers from cancelling their subscriptions as well, according to a new study from Parks Associates.

Parks Associates’ “Pay-TV: Perception, Adoption and Retention” report found a nearly 50% year-over-year increase in the number of pay-TV consumers who receive online video services. More than half (60%) want the TV shows and movies available through OTT platforms available through their pay-TV subscription.

"If there was ever a time when entertainment service providers believed that OTT was a phase, they are now convinced of its permanence," said Kristen Hanich, senior analyst, Parks Associates. "In late 2019, the market reached the crossover point where the same percentage of U.S. broadband households subscribed to an OTT service as subscribed to a pay-TV service, and now OTT adoption outpaces pay-TV by double digits. The good news for providers is consumers often have both pay-TV and OTT—79% of pay-TV households have both pay-TV and OTT subscriptions. Providers are in a spot where they must redouble their efforts to engage these subscribers by executing new innovations and business models, or risk accelerating customer losses."

The average number of OTT services among households that have any OTT service is 3.8. That number is actually higher among pay-TV services that have OTT, as they subscribe to 4.2 OTT services on average.

In addition to streaming, other advanced features could help keep pay-TV subscribers from cancelling their subscriptions. Per Parks’ report, 43% of pay-TV households are interested in having video calls on their TVs; 40% want to control smart devices and security systems from the TV; and 34% are interested in playing video games on the TV through a cloud gaming service.

"Pay-TV providers must keep offering their most valuable content, which includes live sporting and cultural events," Hanich said. "Additionally, they must offer access to streaming, target new service to their interested customers and perhaps be willing to take a hit on pricing until this chaotic market stabilizes."

The full Parks Associates report is available online. 

ADDISON, Texas—The COVID-19 pandemic is resulting in a significant migration of traditional pay-TV customers to virtual MVPD platforms, according to a new report by Parks Associates, including just a little under half of surveyed U.S. broadband households with pay-TV planning to make the switch in the next year.

From its “Growth and Challenges for vMVPDs” report, Parks Associate has found that 43% of U.S. broadband homes that have traditional pay-TV are likely to switch to a vMVPD service within 12 months. During the COVID-19 pandemic, vMVPD services like Hulu + Live TV and YouTube TV have pushed their advantages in pricing, content and platform flexibility to help spur this growth.

The report also found that 17% of vMVPD subscribers had already switched in the previous 12 months. Price was the primary reason, with many saying that their cable or satellite service was too expensive. Other reasons that people cited for switching were some features only being available from an online service; a promotional offer; to watch specific channels; their previous service had too many channels; the cable/satellite service was too unreliable; desire to end contracts and termination fees; or not wanting to deal with required equipment.

Parks says that prior to the pandemic, vMVPD subscriber growth was waning and some vMVPDs were posting continued losses. While the pandemic has helped fuel recent growth, things like vMVPDs recent price increases make it uncertain how consumers will respond long term.

“Subscriber losses in traditional pay-TV continue, while the vMVPD category continues to grow, thanks to consumer price sensitivity and preferences for platform flexibility,” said Paul Erickson, senior analyst, Parks Associates. “Traditional pay-TV operators have online delivery in their roadmaps, if not already deployed. We expect vMVPDs will continue to grow dramatically and will gradually become the dominant offering in the pay-TV landscape.”  

“vMVPDs have substantial opportunity if they can avoid the pitfalls that typically drive pay-TV customer dissatisfaction, such as rising prices and inflexible content and platform options. With content prices rising and competition increasing, vMVPDs should remain conscious of consumer price sensitivity while keeping a strict adherence to a consumer-centric experience,” Erickson said.

For more information, visit the Parks Associates website. 

DURHAM, N.H.—While Leichtman Research Group’s report on the largest pay-TV providers’ third quarter 2020 video subscribers showed a net loss of about 120,000 subscribers, it actually represents one of the best quarters for the industry recently, in large part thanks to the growth of virtual MVPD services. It may be even better if recent YouTube TV news is factored in.

Q3 2020’s loss of 120,000 subscribers is a huge swing from the nearly 945,000 subscribers LRG reported were lost in Q3 2019. All services saw a smaller dip in its subscriber numbers year-over-year: satellite TV services lost about 775,000 in Q3 2020 compared to 1.14 million in 2019; the top seven cable companies lost 375,000, better than 2019’s 410,000; and telephone providers lost just 5,000 versus the 210,000 lost last year. 

When you combine the vMVPD services that LRG reports on (Hulu + Live TV, Sling TV, AT&T TV Now and fuboTV), which added 1.03 million subscribers in Q3 2020 (up year-over-year from 815,000), you get the net loss of 120,000 subscribers.

However, LRG’s report does not include numbers from the Google-owned vMVPD YouTube TV. It was announced in October that YouTube TV had crossed the 3 million subscriber milestone, including the addition of 1 million subscribers in 2020. It’s possible that the gains from YouTube TV could put pay-TV in the black for Q3 2020.

In total, LRG reports that the top pay-TV providers now have 82.6 million subscribers. That is made up of 44.3 million from the top seven cable companies; 22.6 million from satellite TV services; 8 million from top telephone providers; and 7.7 million from the available vMVPD services.

“With the return of live sports in 3Q 2020, internet-delivered vMVPDs had more net additions than in any previous quarter, and pay-TV overall had fewer net losses than in any quarter since 1Q 2018,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group Inc.  “It is more important than ever before to recognize vMVPDs as a key segment of the live pay-TV industry. Hulu + Live TV is now the fifth largest pay-TV service in the U.S., and YouTube TV (which is not part of LRG’s tracking data because it does not formally report quarterly results) now has over 3 million subscribers, including 1 million net additions thus far in 2020.”

DURHAM, N.H.—One of out five consumers are fine with just having some combination of Netflix, Amazon Prime Video, Disney+ or any other SVOD platform as their viewing option at home, according to a new survey from the Leichtman Research Group.

The survey found that 20% of U.S. TV households have a SVOD service but no pay-TV subscription. However, a majority (60%) still do subscribe to both a pay-TV and SVOD service. Only 14% said that they only had a pay-TV service, while just 6% said they had neither pay-TV or SVOD.

Just under three-fourths of households (74%) get a live pay-TV service, be it cable, DBS, telco or an vMVPD. That is down from responses in 2015 (85%), 2010 (88%) and 2005 (82%). Among those with a pay-TV service (cable, telco, DBS), 79% have an SVOD service; if they have an vMVPD that number jumps to 96%. About 76% of pay-TV non-subscribers have an SVOD. 

SVOD isn’t the only way people are watching content if they don’t have pay-TV, as LRG reports that 13% of pay-TV non-subscribers utilize a TV antenna.

The older a respondent was the more likely they were to have a pay-TV subscription: 81% for 55 year olds and older; 76% of ages 35-54; and 63% of ages 18-34. With the youngest age bracket, 27% said they had both a pay-TV service and SVOD, while 46% said they just had an SVOD.

“Traditional pay-TV services from cable, satellite and telco providers are now in less than two-thirds of U.S. households, while an increasing number of households are opting to get live pay-TV from internet-delivered vMVPD services,” said Bruce Leichtman, president and principal analyst for LRG. “Consumers continue to choose the video services that best fit their household needs. For 60% of households, this includes both pay-TV and SVOD services.”

Additional findings from LRG’s report include how 38% of those who moved in the last year do not currently have a pay-TV service, higher than any previous year. Also, 33% of pay-TV non-subscribers had a pay-TV service within the last three years, 34% last subscribed more than three years ago and 33% never had a pay-TV service.

DALLAS—AT&T is reportedly fielding offers for what is being described as “a significant minority stake” in its pay-TV operations, which include DirecTV, AT&T and U-Verse. CNBC was the first to report the news, citing sources familiar with the matter.

AT&T is already in discussions with private equity firms, per CNBC, including Apollo Management. AT&T is looking to keep majority economic ownership of its pay-TV business and ownership of the U-Verse infrastructure, but the buyer would control pay-TV distribution operations and consolidate the business on its books. According to sources, the deal could be from anywhere between 30%-49% of AT&T’s pay-TV operations, CNBC reports.

Final deals are said to be due in early December.

At the end of the third quarter of 2020, AT&T reported that it had about 17 million legacy TV subscribers (DirecTV and U-Verse) and about 683,000 AT&T Now customers.

AT&T acquired DirecTV in 2015 for $67 billion. CNBC estimates that a deal for a minority stake could value DirecTV at less than $15 billion, including debt.

For more information, read CNBC’s full coverage. 

OYSTER BAY, N.Y.—The cord-cutting trend has only picked up steam because of the COVID-19 pandemic, and not just in mature markets where the practice was already making a significant impact.

ABI Research has reported that cord-cutting is starting to take hold in emerging markets, like India, in addition to markets like the U.S., where broadband penetration is high. According to ABI, Indian satellite TV operator Tata Sky lost 1.5 million subscribers in the first half of 2020. In addition, as much as 80% of subscription fees could not be collected by Indian cable operators because of consumers struggling to pay their bills. Similar trends are occurring in other emerging markets like Brazil, Colombia and Thailand, per ABI.

“In mature markets, cord-cutting could create an opportunity for streaming services since some cord-cutters may choose video streaming to replace pay-TV service,” said Khin Sandi Lynn, industry analyst at ABI. “However, in emerging markets, low broadband penetration could be a barrier for many consumers to move to streaming.”

PLUS: OTT Reaches Tipping Point, Per CTA

Because of this, ABI says that pay-TV service providers need to implement price adjustments, like repackaging services into smaller channel bundles or increase promotions. Heavier subsidizing of Consumer Premise Equipment may also help ease fees for customers during this time. However, content security measure must also be put in place, ABI recommends, as a sudden spike in churn could result in content piracy.

One of the key reasons for the loss of pay-TV customers during the pandemic has been the loss of live sports programming. ABI believes that the return of sports will make the deep subscriber loss temporary, especially in the markets with limited broadband connectivity. ABI projects that in 2025 there will be 1.1 billion pay-TV subscribers globally; there is currently 1.07 billion, according to ABI.

For more information, visit www.abiresearch.com.  

ARLINGTON, Va.—The growth of streaming over the course of the pandemic, and before, has been reported on a number of occasions, but a new report from the Consumer Technology Association indicates that for the first time more people are paying for a streaming service than they are for traditional pay-TV.

In its report, “Content in the COVID-19 Era: Current Realities and Future Opportunities,” CTA looked at the impact of the pandemic on consumer entertainment, as well as video gaming content consumption behaviors.

According to CTA’s report, 71% of U.S. consumers are using a paid streaming service, while 58% are using a traditional pay-TV service. In 2020, paid and free streaming services have grown by 19 and 15 percentage points, respectively. Conversely, pay-TV services from cable, satellite or fiber providers have dropped 15 percentage points since 2018. In addition, one-quarter of consumers added at least one paid streaming service within the past few months.

Even with the shift to streaming platforms, the TV remains the primary source of entertainment, according to nine out of 10 consumers (92%). The report also finds that 60% of video content viewing time takes place in front of TV screens; the rest is on smartphones, computers and tablets.

Additional data from the report showed that 65% of U.S. adults watch content more often since COVID-19 began, and that three in 10 consumers rented at least one new movie released directly to streaming, while more than half plan to do so over the next six months.

“With more time at home, the pandemic has accelerated several trends in media, entertainment and gaming,” said Sayon Deb, manager, Market Research, CTA. “Consumers are watching more content and watching longer, as new innovations in format and delivery draw in millions of first-time users. New digital activities such as virtual concerts, live streaming and shared viewing on social platforms are also resonating with consumers.”

For more information, visit www.cta.tech.  

LONDON—While pay-TV has been experiencing historic lows in the U.S., the global pay-TV market shows that it’s not all doom and gloom. According to a new report from Ampere Analysis on the second quarter of 2020, bellwether pay-TV companies throughout the world added more than 3.1 million subscribers.

Ampere reported on more than 70 companies for the study. This bellwether group of companies accounts for more than half of the world’s 1.1 billion pay-TV subscribers.

Of the bellwether companies that reported to Ampere, 44% saw growth in Q2 2020, adding nearly 7 million subscribers. The remaining 56% saw a loss of 3.9 million subscribers, which brought the quarter to a net growth of 3.1 million subscribers. 

The U.S. market led losses, with 1.4 million dropping their subscriptions across the bellwether companies, despite slight growths from Charter and Dish. China, on the other hand, saw the most net additions among its bellwether companies with a net gain of 3.1 million. The rest of the world’s bellwether pay-TV operators lost around 1.1 million net subscribers.

In comparison to the first quarter of 2020, Q2 total pay-TV subscriber totals were 0.5% higher, this despite the loss of premium content like live sports and other increased economic pressures due to the COVID-19 pandemic. However, if you were to remove the three most populous nations from Ampere’s report—China, India and the U.S.—that growth would only be 0.1%.

The losses in the U.S. have been an ongoing trend, with Ampere reporting that U.S. bellwether companies have lost 6.3 million net subscribers in the last four quarters.

Some other country notes shared by Ampere show that Canada experienced its second largest combined quarterly pay-TV subscriber loss in Q2 2020. This was offset by growths in France and Spain, which had their largest bellwether net additions in more than a year.

Proportionally, Ampere says that Australia was hit the hardest in Q2 2020, followed by Denmark, the U.S., Canada, Brazil and New Zealand all having posted losses. Spain had the largest percentage growth in Q2 2020, followed by Russia, Romania, India, China and France.

“While some countries are seeing pay-TV subscriptions suffer due to the COVID pandemic, particularly caused by the transient loss of sport, there is still growth in the market, driven partly by bundling of services and by emerging markets,” said Toby Holleran, senior analyst at Ampere. “Cord-cutters in a number of developed territories like Canada—whose pay-TV market continues to mirror its North American neighbor—are being replaced by newer TV customers in emerging markets, leaving the markets as a whole stable. But there is a little growth left even in some developed nations such as France and Spain, which are bucking the trend of stagnation in Western territories.”

For more information, visit www.ampereanalysis.com.  

NEW YORK—After what was a devastating second quarter for pay-TV—video customer losses reached a new record, fueled by the pandemic and the overall shift to streaming services—influential media analyst Craig Moffett believes that the worst is yet to come. 

Pay-TV shed about 1.8 million subscribers in Q2, fueled by continued heavy losses at DirecTV and Dish Network, as well as pandemic-fueled declines at Comcast and telco TV providers. Comcast more than doubled its video losses in Q2 to 478,000 (from about 224,000 in the prior year), while DirecTV continued to bleed customers, losing 871,000 subscribers in the period. 

Charter Communications was the only bright spot on the video front in the period, adding about 102,000 video customers. But Moffett, principal and senior analyst at MoffettNathanson, doesn’t expect that trend to continue. In a note to clients, he said that the industry weathered yet another record subscriber decline and it shows no signs of letting up.

According to Moffett’s estimates, pay-TV subscribers fell 7.7% in Q2 (8.3% if pandemic-related nonpay customers are excluded), the worst ever for the sector. And it comes after eight consecutive quarters of worst-ever losses. 

That forebodes a scary trend for the business.     

“At this rate of decline (somewhere between 7.7% and 8.3% per year), the traditional pay-TV business would disappear entirely in another 12 years,” Moffett wrote, adding that just two years ago the rate of decline was 3.3%, while last year fell at a 5.4% clip.

Cable operators have shifted their focus toward broadband, which enjoyed record growth in Q2. Charter added 850,000 high-speed internet customers in the period, 50% above the prior quarter, while Comcast and Altice USA also had record growth in that segment. Broadband growth is expected to continue. And, at the same time, more customers are opting for broadband-only service, using that connection to access Netflix, Amazon Prime Video, Hulu, Disney Plus and Peacock and driving a stake through the heart of the video business.  

Adding to the confusion, Moffett said, is the uncertainty around the Keep America Connected pledge, under which most cable operators agreed not to disconnect broadband customers during the pandemic for lack of payment. While no operators are being accused of skewing numbers, it is difficult to determine how many of those customers will convert to paying subscribers once the pandemic subsides.

Then there’s the question of new household formation, which according to U.S. Census Bureau statistics, reached 2.28 million additions in Q2. That, too, could be skewed by the pandemic, Moffett said, boosted in part by a moratorium on rental evictions, people occupying their seasonal second homes, or just a product of the “impossible environment for data collection.”

Other analysts expect video subscriber erosion to continue. In a research note, Evercore ISI media analyst Vijay Jayant predicted Comcast would lose around 400,000 video customers in Q3, while broadband subscribers would rise by 525,000.

At the Goldman Sachs Communacopia conference last month, Comcast chairman and CEO Brian Roberts said the company was on pace to break records in broadband additions, adding that it was already “well over 500,000” broadband additions in mid-September.

In a research note, Sanford Bernstein media analyst Peter Supino said the focus on broadband will help drive margins higher. “Comcast’s excellent internet sub results reinforce our ‘losing to win’ theme: that the confluence of robust internet and relentless video subscriber losses means structurally improving margins and ROIC,” Supino wrote of Comcast’s Q2 performance. 

Altice USA, which surprised the industry with its $7.8 billion unsolicited bid (with Rogers Communications) for Canadian telecom company Cogeco on Sept. 2, also is expected to see continued video erosion. At press time, there had been little movement on that bid since Cogeco’s controlling shareholder flat-out rejected it in September, but the pace of video declines highlights the need to expand the footprint. Altice USA, which has the highest broadband penetration rate in the industry in its metropolitan New York area, lost about 35,000 video subscribers in Q2, but added a record 70,000 broadband customers, more than three times consensus expectations of 21,000 additions.

Supino expects video losses to level out at Altice over the next few years. In a research note, he estimated video losses would hover between 30,000 and 40,000 through Q1 2024. He estimated broadband growth would be around 20,000 to 40,000 per quarter during the same time frame.

DTC: THE LAST NAIL

While broadband rolls rise, the shift to streaming video continues at an accelerated pace. And Moffett believes the transformation of the content business to a direct-to-consumer (DTC) model will drive the final nail in traditional pay-TV’s coffin. In his note, Moffett predicted that content redirection, the practice of taking A-list shows from traditional networks and offering them DTC, is the second wave that will ultimately make pay-TV as we currently know it moot.

The analyst warned that as networks are redirecting content while their channels are still under contract with traditional distributors—with escalators that help partially offset subscriber declines—that train could stop running come renewal time. Moffett estimated that overall affiliate fees dropped 3% in Q2 for the first time ever. Over the next four years, he predicted that 0% affiliate-fee growth would be the new normal for cable networks. 

“The pay TV ecosystem is well and truly unraveling,” Moffett wrote.

NEW YORK—Even though TV watching has been up in 2020, when it comes to pay-TV subscriptions the numbers are historic in the wrong kind of way. According to a report from eMarketer, cable, satellite and telecom TV providers are on pace to lose the most subscribers ever in a single year in 2020.

By the end of the year, eMarketer is projecting that 31.2 million U.S. households will have cut the cable cord in aggregate. In addition, 6.6 million households are expected to cancel their pay-TV subscriptions. Projecting down the road, eMarketer estimates that a third of U.S. households will have cut the pay-TV cord by 2024.

This brings the total number of U.S. households with cable, satellite or telecom TV packages down to 77.6 million, down 7.5% year-over-year, the biggest drop ever, per eMarketer.

“Consumers are choosing to cut the cord because of high prices, especially compared with streaming alternatives,” said Eric Haggstrom, eMarketer forecasting analyst at Insider Intelligence. “The loss of live sports in H1 2020 contributed to further declines. While sports have returned, people will not return to their old cable or satellite plans.”

In relation to the loss of subscribers is a drop in traditional TV ad spending. eMarketer projects that the total ad spend for traditional TV in 2020 will be $60 billion, representing a 15% drop year-over-year and the lowest total since 2011. There is expected to be some rebound in 2021, but eMarketer estimates that TV ad spending will remain below pre-pandemic spending until at least 2024.

Haggstrom forecasts that ad spending will instead shift to digital video.

For more information, visit eMarketer’s full report.

WASHINGTON—FCC Chairman Ajit Pai is proposing to close the book on a cold proceeding that was once red hot: New regs on the navigation device market meant to spur over-the-top video competition to cable.

On Aug. 14, Pai circulated an item entitled "Expanding Consumers' Video Navigation Choices; Commercial Availability of Navigation Devices," which was a blast from the past.

But since Pai was a strong opponent of new cable set-top regs—proposed under his predecessor, Tom Wheeler—it was likely not a revival of the issue for further consideration. It isn't.

An FCC spokesperson confirmed that, instead, it is officially closing the still-open proceeding, and with an exclamation point. "This item would terminate the proceeding in which the prior commission proposed imposing complex and unnecessary regulations on the navigation device market that generated bipartisan opposition within and outside the agency, and serious concerns from a wide range of stakeholders and experts, including the U.S. Copyright Office," they said.

Wheeler's proposed rules would have required pay-TV providers to offer consumers a free app, controlled by the MVPD, to access all the programming they pay for on a variety of devices, including tablets, smartphones, gaming systems, streaming devices or smart TVs. That, in turn, would make it easier for consumers not to have to rent boxes from their provider.

Pay-TV providers are also would have been required to provide their apps to widely deployed platforms, such as Roku, iOS, Windows and Android.

The rules would also call on MVPDs to support integrated search for linear and VOD, alongside other video services accessible on the device, such as OTT offerings. Pay-TV providers would also have been barred from discriminating in search results or promoting the pay-TV app over other sources of programming in the search function.

Cable ops pushed back hard on the new regs and Wheeler could never lock down the three votes he needed before the election, and Pai, who opposed the regs, replaced him.

It got so far as being scheduled for a vote but was pulled from a September 2016 public meeting agenda at the last minute. Commissioner Jessica Rosenworcel supported providing more choice and lower-cost options for navigation devices, but had issues with the proposal to have the FCC backstop app licensing agreements, and reached out to programmers to clarify their problems with the item. Programmers said they still had many.

The FCC must still vote to close the docket, but Pai almost certainly has the two other Republican votes to do so.

ENGLEWOOD, Colo.—Dish Networks lost a total of 96,000 pay-TV subscribers in the second quarter of 2020, which includes customers of both Dish TV and Sling TV.

Dish TV net subscribers decreased by 40,000 in Q2, as well as 56,000 Sling TV subscribers, for a total of 96,000. However, those numbers are better than the amount of subscribers that left in Q2 2019, which was a combined 127,000.

An interesting element to Dish’s subscribers for Q2 was the return of thousands of commercial accounts. Because of the disruption COVID-19 had on businesses, Dish paused or provided temporary rate relief for 250,000 commercial accounts, removing them from its pay-TV subscriber numbers at the end of Q1 2020. In Q2, 45,000 of these account were reactivated and added back to the overall subscriber count (but were not counted as new subscribers), which gave Dish an overall subscriber count increase of 5,000 at the end of Q2 compared to Q1.

The official pay-TV subscriber numbers for Dish are 11.27 million subscribers—9.02 million for Dish TV and 2.25 million for Sling TV.

As far as overall revenue for Q2, Dish reported it brought in $3.19 billion, down from $3.21 billion year-over-year. The total yearly revenue for Dish at the end of Q2 was $6.4 billion, up from $6.39 billion for the half-way point of 2019.

For more information, visit ir.dish.com. 

STAMFORD, Conn.—Programs aimed at keeping residential customers connected online during the nationwide pandemic helped fuel growth at Charter Communications in Q2.

Charter said it added 102,000 video subscribers in Q2, a reversal of the 150,000 video customers it lost in the prior year but entirely the result of programs like the FCC Keep America Connected pledge and others, where providers agreed not to disconnect customers for non-payment.

Charter said that 149,000 video customers signed up in Q2 as part of the FCC Keep America Connected pledge and 12,000 joined through its Remote Education Offer. The company said nearly 50% of REO customers chose to subscribe to other services like video, voice and mobile and were billed for those products.The REO program expired on June 30, and Charter said 90% of cumulative connects through that program have retained service through July 27.

On a conference call with analysts, Charter chairman and CEO Tom Rutledge said regardless of how those customers came to the company, they are acting like any other subscriber that joined via a traditional promotion.

“From a profile perspective they look just like our regular customer base and they are just like our regular customer base,” Rutledge said. “They very much are behaving like all customers we create. We look at that offer in many ways as a conventional offer with a broadband benefit, but it brought in real customers that subscribe and act like existing customers.”

However, he didn’t expect to see continued video growth, adding that it was a combination of the pandemic which kept people stuck in their homes and in front of their TV sets, and the programs.

“The secular trends for video haven’t changed,” Rutledge said.

Despite subscriber gains, Charter said video revenue was down 0.4% for the period to $4.4 billion, which the company said was due to a higher mix of lower-priced video packages and the waiver overdue customer balances.

The FCC program also was a big factor in broadband gains. Charter said it added about 825,000 residential and business broadband subscribers in the quarter, but added that about 600,000 residences and 100,000 businesses applied for the FCC program, and at its peak, 208,000 residences and 14,000 businesses would have been disconnected for non-payment. About 30% of those Keep America Connected customers’ bills were current and more than 60% were making partial or full payments. Charter said that to help those customers with overdue balances, it waived $76 million residential, $6 million business and $3 million of mobile receivables in the quarter.

Charter also said it added 325,000 wireless customers in the period, ending the quarter with 1.7 million Spectrum Mobile subscribers.

The subscriber growth helped fuel a 3.1% lift in total revenue to $11.7 billion. Adjusted EBITDA rose 7.3% to $4.5 billion.