Q2 US pay-TV subs fall but OTT prospers

Strategy Analytics’ analysis of US pay-TV subscriber numbers shows Virtual Multichannel Video Programming Distributor (vMVPDs) with 868,000 net adds in Q2 bringing the total number of vMVPD subscribers to 6.73 million, up 119 per cent YoY.

Despite this, overall pay-TV subscribers (cable, satellite, IPTV, vMVPD) fell to 93.78 million, breaking a string of two consecutive quarters of growth, according to a Strategy Analytics’ Television & Media Strategies report, which examined the subscriber bases of 27 public traded and private pay-TV operators, accounting for 97 per cent of all pay-TV subscriptions.

“While the entire vMVPD segment is growing, AT&T’s DirecTV NOW deserves special notice,” said Michael Goodman, Director, Television & Media Strategies, given how rapidly it has grown in a fairly short period of time. If it continues on its current growth trajectory it will overtake Sling TV as the largest vMVPD in early 2019.”

In comparison, Qq 2018 was not particularly kind to legacy pay-TV providers (e.g., cable, satellite, IPTV) as they lost nearly as many subscribers (-973,000) as the prior two quarters combined (-1.16 millio). In Q2 2018, total legacy pay-TV subscriptions fell to 87.05 million, down 3.6 per cent YoY.

“Historically, pay-TV in the US has consisted of cable, satellite, and IPTV; however, the introduction of over-the-top pay-TV services, commonly referred to as vMVPDs, necessitates a change in our thinking,” said Goodman. “What we have commonly referred to as pay-TV (cable, satellite, and IPTV) should now be referred to as legacy pay-TV, while the definition of pay-TV should include vMVPDs.”

read more here: advanced-television.com

Advertising Spend on TV and Video Will Reach $559B Globally in 2022

Consumer spend and digital video ad revenue from OTT video services such as YouTube, Facebook, iTunes, Google Play, Netflix, Amazon Prime Video, Hulu, DirecTV Now, NOW TV, Maxdome, iflix, and other online video services will double over the forecast period, reaching $123B in 2022.

“OTT TV and video services will be the driving force behind future revenue,” according to Michael Goodman, Director, Television & Media Strategies, “however, traditional TV and video services should not despair too much, as they will continue to account for the majority of consumer and advertising spend for the foreseeable future.”

By 2022, consumer and advertising spend on traditional TV and video products and services globally will be over $435B, an increase of $7B from 2017, and account for nearly 78% of all TV and video revenue.

Additional findings from this report include:

– In 2022, North America will continue to be the largest TV and video market; accounting for 38.7% of global consumer and advertising spend on TV and video.

– IPTV will buck the cord cutting trend in Western Europe. While cable (net loss of €987M), pay satellite (net loss of €187M), and pay DTT (net loss of €125M) will all see revenues decline over the next five years, IPTV will reach €9.9B in 2022, an increase of €1.5B.

– In 2022, the Asia Pacific region will account for 23.4%% of global consumer and advertising spend on TV and video. Unlike North America and Western Europe, where consumer spend on legacy pay TV services are flat or declining, driven largely by China and India, consumer spend on legacy pay TV services will continue to see robust grow.

download the full report here.