Is pay TV becoming the next "buggy whip"? | The Boneyard

Is pay TV becoming the next "buggy whip"?

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Read below:

812,000 pay-TV subscribers cut the cord in the second quarter of 2016
Meg James, Los Angeles Times on Aug 30, 2016


The flight of pay-TV customers continues.

In a grim reminder of the challenges facing media companies, an estimated 812,000 subscribers pulled the plug on their pay-television service in the second quarter, according to a study by consulting firm SNL Kagan.

The number represents a decline in the number of homes that received a bundle of video channels from a cable, satellite or telephone company compared with the first quarter of 2016.

"It is a bit of an acceleration and the biggest quarterly loss that we've seen," Ian Olgeirson, an analyst with SNL Kagan, said Monday in an interview. "We are seeing a gradual increase in the decline rate."

The year-over-year number was more startling. There were nearly 1.4 million fewer pay-TV subscribers in the second quarter of 2016 compared with the second quarter of 2015.

The April-June quarter tends to be the weakest for the pay-TV industry as students and families move at the end of the school year, canceling their TV subscriptions.

Consumers now have more options. Increasingly, they are drawn to online video services such as Netflix, Amazon.com, Hulu and CBS All Access, which can be more affordable when combined with a broadband Internet subscription. Younger users are just as comfortable watching shows on phones and tablets as they are watching them on TVs.

In the second quarter, the telephone sector experienced the greatest losses, an estimated 488,000 homes, but some of that erosion could be attributed to AT&T's efforts to migrate customers to its satellite service, DirecTV. AT&T acquired the satellite-TV service last year. In addition, Frontier Communications took over Verizon's service in several markets, including Southern California.

But even picking up additional customers from AT&T U-Verse wasn't enough to offset a net loss in the satellite-TV sector. Providers dropped a net 26,000 customers compared with the first quarter. Dish Network has been particularly hard hit.

Cable-TV operators have shown strength in the last two years but still experienced a net loss of 298,000 subscribers in the second quarter, the SNL Kagan report found.

Two years ago, the pay-TV industry experienced a net loss of 291,000 subscribers in the second quarter compared with the first quarter. Olgeirson said the first time that SNL Kagan detected a decline in pay-TV subscribers was for the second quarter of 2010.

(c)2016 Los Angeles Times

Visit the Los Angeles Times at www.latimes.com

Distributed by Tribune Content Agency, LLC.
 

SubbaBub

Your stupidity is ruining my country.
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No, TV is just a device. The cable companies will figure a way to port your subscription to multiple devices assuming their content providers don't bypass them and go straight to the consumer.

The cord cutters are still watchng something and cable still holds a tremendous advantage in distribution if they play it right.
 

huskypantz

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Yeah, we have rehashed ad pukeum and it's been said many times - the cable companies hold both ends - cable and broadband internet. They are going to make money either way, and if you stream everything then they're going to charge you more. They already do in some cases. There was an article about Spotify today - basically suggesting that the $10/month all-inclusive music subscription was going the way of the dodo and the next phase was country music at $5, classic at $4 etc. A la carte music. The financials are still working themselves out, but we'll see the "visual entertainment industry" continue to evolve.
 
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