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Pay-TV Continues to be Decimated by Cordcutting Trend

MONTEREY, CA.–Despite increasing uptake rates by so-called “skinny bundles,” cable and satellite operators continue to see declining subscription rates to their main pay-TV services, according to Kagan.

According to the media research Kagan’s Q2 2018 U.S. Multichannel Subscriber Report, cable, direct broadcast satellite (DBS) and telco multichannel sectors combined lost 860,640 video subscribers in the three-month period ended June 30, 2018, ending the quarter at 92.2 million, down from 98 million the same period a year ago.

While the combined total was less than the loss of 976,000 video subscribers during the same quarter a year ago, DBS logged its second largest quarterly decline on record, losing a combined 478,000 customers, while cable logged its largest second-quarter video subscriber drop since 2015, bringing year-to-date losses to 685,790. The telco video segment improved dramatically during the period however, reducing its losses to just 56,000, or just a fraction of the pattern of quarterly losses established in the last two years, according to Kagan.

The picture for pay-TV operators improves, however, when taking their OTT-based “skinny bundles” into account. DIRECTV NOW and DISH’s Sling TV reduced the quarterly subscription losses by approximately 45 percent, raising the residential figure to 93.5 million.

The residential multichannel penetration rate stood at 75% as of June 30 when including the virtual multichannel services owned by AT&T and DISH Network (DIRECTV NOW and Sling TV).