Cord-Cutting Lessens As Digital Pay TV Rises

Some good news for pay TV providers and cable networks -- cord-cutting has slowed, thanks to growth in new digital pay TV services.

Craig Moffett, senior research analyst, MoffettNathanson Research, says: “Total subscriptions for live TV, including vMVPDs (virtual multichannel video program distributors) declined at the slowest rate in almost three years.”

The first quarter of this year witnessed a 0.5% drop in both traditional and new digital live, linear TV network services, amounting to a 247,000 decline, according to MoffettNathanson.

This comes versus a 0.7% decline in the fourth quarter last year; a 0.6% drop in the third quarter 2017; a 1% fall in the second 2017; and 1.1% pullback in the first quarter of a year ago.

New U.S. household formations in the first quarter declined more than 200,000 households, versus gains of a year ago. He says: “The stronger the growth in new households, the higher the expected number of pay TV subscriptions.”

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In the first quarter of this year, traditional pay TV subscribers declined 3.4% -- a total drop of 809,000. This came from a 1.8% fall for cable operators, a 5% drop for satellite TV services; and a 6.8% drop for telco companies, Moffett notes.

Estimates are vMVPDs grew by 562,000 in the first quarter -- now totaling 5.15 million. This follows a 772,000 rise in the fourth quarter of 2017 and a 956,000 gain in the third quarter of 2017.

Total traditional pay TV subscribers are now at 92.17 million -- adding in the 5.15 million vMVPDs subs brings that to 97.32 million.

Moffett says TV networks may be gaining, due to new digital network bundles.

“Given that vMVPDs generally pay higher prices (per subscriber) than their larger linear peers, cord-cutting may actually be even better than “relatively painless. At least for the most widely-carried network groups, it may actually be a net plus.”

2 comments about "Cord-Cutting Lessens As Digital Pay TV Rises".
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  1. Douglas Ferguson from College of Charleston, May 11, 2018 at 10:43 p.m.

    Bleeding out more slowly is still a poor prognosis. 

  2. Virginia Juliano from showtime, May 12, 2018 at 10:25 a.m.

    "declined at the slowest rate in almost three years" is" not exactly "Pay TV Rising". #BreakTheBundle www.CobbleCord.com

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