# Pay-TV Industry Suffers First Subscriber Decline On Record



## Mark Holtz (Mar 23, 2002)

From Wall Street Journal/Smart Money/Dow Jones Newswire:

*Pay-TV Industry Suffers First Subscriber Decline On Record*


> The subscription television industry--including cable, satellite and telecommunications companies--suffered its first-ever drop in total subscribers in the second quarter, according to research firm SNL Kagan.
> 
> The firm cited the weak U.S. economy as the main culprit for the decline, along with the after-effects of the government mandated transition to a digital broadcast spectrum. But the stumble comes at a fragile time for the TV business as it navigates the transition to digital media.


FULL ARTICLE HERE


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## Jtaylor1 (Jan 27, 2008)

This is because, people are now using the net and sharing their desktop/laptop computers with their families and friends to watch shows.


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## Satelliteracer (Dec 6, 2006)

Jtaylor1 said:


> This is because, people are now using the net and sharing their desktop/laptop computers with their families and friends to watch shows.


The NY Times had another article about people who had "cut the cord" and are coming back within a year to their pay tv provider because they were not satisfied with the limited content they had access to. To many shows that were tied to pay television only.

Different folks will certainly have different experiences. It all depends on what you consume (content), how you wish to consume it (TV, PC, rabbit ears, HD, VOD), when you wish to consume it (real time or willing to wait), and what value you place on each of those.

Here's the article

http://www.nytimes.com/2010/08/23/business/media/23couch.html?_r=2&pagewanted=1&ref=media


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## Jason Whiddon (Aug 17, 2006)

I tried it, but the wife was not happy, and when ball season rolled around, ESPN was a must. ESPN is like crack, and Disney knows it.


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## tvwatcher365 (May 24, 2005)

I still find value in my pay-tv subscription, especially for sports. Although I could do without a lot of the reality tv shows and popups. Also I hate how some networks (Spike, TV Land) show their programming off-the-clock, to insert more advertising.


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## Gloria_Chavez (Aug 11, 2008)

I do think that committed sports watchers get good value from PayTv, at the expense of those who don't watch sports. ESPN charges everyone about 4 dollars a month, enabling those who watch it to partake of it at a price much lower than if ESPN were a stand-alone channel.

But it may be getting to the point where this is no longer viable. As Mark Holtz says, for the first time ever, in 2Q10, we saw a decrease in subscribers.

Over the last 5 years, how much has the average PayTV bill increased?

How much has inflation been during that time period.

How much has the median wage increased during that period?

Something's got to give.


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## Mark Holtz (Mar 23, 2002)

Whats my bone of contention? The $ports channels, especially E$PN and the Regional $ports Networks. The per-subscriber fees are like $2-$4 per subscriber. Yet, E$PN is in the Top 120 for Dish Network and the Choice for DirecTV. These are the lowest advertised packages for both DBS providers, meaning you pay for it whether you like it or not. And there is enough sports fans out there for Darth Maus to insist on the charges.

Another thing is that many TV shows nowadays will release their entire seasons on DVD/BluRay without annoying logos or in-show advertising for other shows. Perhaps I can wait.


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## spartanstew (Nov 16, 2005)

Jtaylor1 said:


> This is because, people are now using the net and sharing their desktop/laptop computers with their families and friends to watch shows.


Ya think?


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## Drucifer (Feb 12, 2009)

I would think the recession is a big cause for family cutbacks.


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## James Long (Apr 17, 2003)

Drucifer said:


> I would think the recession is a big cause for family cutbacks.


I agree. I don't believe the major loss is coming from people moving to download ... it is coming from people cutting the cable. Download/online viewing (for those who have it) serves as more of something to soften the blow. I believe only the most tech savvy would drop service they could afford to move to download/online viewing.

The companies that are doing well despite the industry wide downturn are those who are offering discounts. They are not keeping their customers as much as they are gaining "new" customers who get hundreds of dollars in incentives to become a customer. And customers are taking advantage of the lower prices - some with the hope that by the time the discount goes away their economy will improve. (Although the economy has been down long enough that many families are becoming more cautious about the future.)

I believe TV is becoming a luxury again. Gotta cut something. Personally I'd cut Pay TV before the Internet so it would be a natural to seek out the online viewing sites to get the content I would be missing.


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## Ambavi (Sep 26, 2007)

One more thing. There are too many channels to watch and not enough good quality programming out there. They are constantly re-running the same old movies and shows.


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## QuickDrop (Jul 21, 2007)

I wonder how much of this is a demographics issue. People in their twenties and early thirties might have grown accustomed to accessing programming in non-traditional methods and now that they have their own "households" they aren't prejudiced against not having cable. Before, it was old-fashioned not to have cable/satellite service. Now, it is considered cutting-edge.


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## Gloria_Chavez (Aug 11, 2008)

There are more ways to get the programing. You want to watch Colbert or Jon Stewart, you go to Comedy Central. Mad Men, you can buy for 34 dollars for a season pass from Amazon. I do believe that many people who watch their favorites via Hulu would subscribe to DTH or Cable, if prices were about 40% cheaper. There is something wrong with charging every household 4 dollars a month for ESPN, whether you watch it or not. In Germany, only 15% subscribe to payTV. The percentage can decrease in the US.


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## James Long (Apr 17, 2003)

Gloria_Chavez said:


> In Germany, only 15% subscribe to payTV. The percentage can decrease in the US.


In Europe there are Freeview satellite systems. We don't have that in the US (other than what could be considered a hobby distribution of FTA).


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## Shades228 (Mar 18, 2008)

As more home foreclose more people lose TV. Yes these people are moving somewhere but many of them are moving in with family. The smaller % who end up renting their own place are probably more inclined to not have luxury costs because they know that the loan isn't going to just disappear. Subscriber growth mirrors the housing boom. Until the housing market gets back to a sustainable growth I don't see video subscriber growth as possible and it will not be as large as it was in the past.


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## Scott in FL (Mar 18, 2008)

When Fall rolls around and football returns, I wouldn't be without Directv. To me, football and its associated coverage makes the price worth it.

But a few weeks ago I was so disgusted... I said to my wife, for $106 a month (no HBO, Showtime, etc.), you'd think we could find something good on tv.

The Knife Show, an average movie with commercials every 10 minutes, crap, yet another rerun of some lame sitcom, more crap... Did I mention crap?


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## Scott in FL (Mar 18, 2008)

James Long said:


> In Europe there are Freeview satellite systems. We don't have that in the US (other than what could be considered a hobby distribution of FTA).


The Freeview systems in the UK basically cover the BBC, ITV, Channel 4, and Channel 5.

In The Netherlands there are only 3 free OTA stations, the old public stations. To get RTL 4, RTL 5, SBS, etc., you must either pay for cable or Digitenne.

Hotbird, Astra, Canal Plus are mainly pay channels.

There's a lot of pay tv in Europe.


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## James Long (Apr 17, 2003)

Scott in FL said:


> There's a lot of pay tv in Europe.


One should look at what we're paying for in the US ... people are paying for free OTA TV. They are buying "lifeline" cable packages and basic satellite packages just to get local channels that should be free. Based on percentage of viewing ... we, as a nation, pay a lot for free TV.

It is an entirely different marketplace.


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