15% of Pay TV Customers Downgraded Service in the Last Year

According to the researchers at Parks Associates, 15 percent of all pay TV subscribers in the U.S. with broadband connectivity downgraded to a less expensive service in the last year. Also, 34 percent changed their pay TV service in some way. Other changes include switching to a new TV provider, upgrading to a more expensive service, subscribing to a TV service after not having service for a year or longer, and subscribing to a TV service for the first time.

The industry is seeing a wave of people leave pay TV and sign up for one or more OTT accounts. According to Elizabeth Parks, senior vice president at Parks Associates, OTT subscription numbers keep rising—with 64 percent of U.S. broadband households now signing up—while pay TV subscriptions are declining.

Last week, Parks revealed that 47 percent of U.S. homes with broadband watch user-generated content two or more times per month.

Parks Associates: Recent Changes Made to Pay-TV Service (PRNewsfoto/Parks Associates)

“User-generated live content is gaining popularity, with platforms such as Instagram Live providing new ways for content creators to engage with their viewers in real-time,” says Billy Nayden, research analyst for Parks. “As more alternatives to traditional TV emerge, all players will explore new and unique ways to package and present digital streaming as part of their services.”

Pay-TV execs expect increased competition

The global findings of the 2018 Pay-TV Innovation Forum, produced by content protection and multiscreen television solutions provider NAGRA in partnership with international research and strategy consultancy MTM, highlight that 84 per cent of pay-TV executives expect competition for paid-for video services to increase dramatically over the next five years.

The programme seeks to identify how innovation is driving opportunities for content owners and service providers around the world as they face a disrupted market. The findings are based on extensive regional research conducted in Europe, North America, with a special focus on the United States, Asia-Pacific and Latin America.

While participants are optimistic they can continue to appeal to paying consumers, an increasing number – 90 per cent of executives – believe that pay-TV providers will have to innovate strongly to remain competitive and relevant, up from 85 per cent in 2017.

The research highlights how the pay-TV industry is converging towards a platform-agnostic model, and as a result is transitioning into a paid-for-video market, spanning a variety of offerings including standalone OTT and direct-to-consumer services. This shift is another reason why 77 per cent of pay-TV executives consider innovation to be one of the top three strategic priorities for the industry.

Content piracy remains a concern, with executives agreeing that the industry is experiencing a significant threat to the long-term sustainability of pay-TV and OTT businesses. Forty-seven per cent of 2018 respondents believe that piracy will lead to greater pressures on the industry over the next five years, in line with 2017 findings.

While challenges remain, this year’s research brings into focus the six key innovation areas in the industry:

– Continued investment in next-generation pay-TV services: Most pay-TV providers (65 per cent) have improved their portfolios in the last 12 months, primarily focusing on the core pay-TV proposition as they deploy next-generation set-top boxes that support advanced functionalities such as third-party apps, personalised content recommendations, and 4K.

– More diverse multiscreen pay-TV propositions: 77 per cent of executives surveyed believe that pay-TV bundles will evolve substantially over the next five years, catering to the needs of different customer groups, and 89 per cent agree that delivering a seamless and personal consumer experience will be key.

– The next wave of aggregation – super aggregators: This model, where companies offer a range of content and services via a single subscription, is seen as a way of simplifying a fragmented marketplace for consumers, while also offering additional growth opportunities for well-established operators.

– Converging pay-TV / OTT offerings: Most traditional pay-TV providers are now looking to offer converged pay-TV/OTT services. As a result, the pay-TV market is transitioning into a paid-for-video market.
– Moving beyond the set-top box: Many industry executives believe that network infrastructure and billing relationships – rather than proprietary set-top boxes – are now the gateway to the customer.

– Growing focus on diversification, particularly connectivity: Fixed and mobile broadband services are expected to grow in importance in future as providers pursue bundling strategies to deliver better value and improve stickiness.

“Change is the one constant in the global pay-TV industry, driven by numerous pressures from competitors, pirates and subscribers, making it challenging for service providers and content owners to maintain revenue growth,” said Simon Trudelle, Senior Director, Product Marketing, NAGRA. “It has never been more important to understand new consumer expectations, anticipate future needs and innovate, and this report reflects the way pay-TV service providers around the world are taking the necessary steps to strengthen and grow their product and service portfolios.”

read more here: advanced-television.com

Top 10 pay-TV operators to lose $20bn

Despite adding 84 million subscribers between 2017 and 2023, subscription and PPV revenues for the world’s top 517 pay-TV operators will fall by $18 billion (€14.67bn) to $183 billion, according to analyst firm Digital TV Research. From the total, 29 pay-TV operators earned more than $1 billion in revenues in 2017, but this total will drop to 25 by 2023.

About $20 billion of the revenue losses will fall to the top 10 players; bringing their total down to $87 billion. The pay-TV revenue share for the top 10 operators will fall from 53 per cent in 2017 to 48 per cent in 2023.

All of the top 10 operators in 2017 will lose revenues over the next five years. In fact, 168 of the 517 operators (32 per cent) covered in the Global Pay-TV Operator Forecasts report will lose subscription and PPV revenues between 2017 and 2023.

Pay-TV subscriptions for 517 operators with 747 platforms [132 digital cable, 126 analogue cable, 286 satellite, 137 IPTV and 66 DTT] across 135 countries covered in the report will increase from a collective 880 million in 2017 to 967 million by 2023. These operators took 87% of the 1,006 million global subscribers by end-2017, with this level expected to inch up to 88% of the 1,100 million total by 2023.

“The good news is that 15 operators will add more than $100 million between 2017 and 2023, with China Telecom up by $1.4 billion,” advised Simon Murray, Principal Analyst at Digital TV Research. “However, five operators, including four from the US, will lose more than $1 billion in revenues. Seven of the top 10 losers will be in the US.”

Top 10 operators by revenues ($ million)

Operator Country 2017 Operator Country 2023
1 AT&T (total) USA 30,740 1 AT&T (total) USA 23,577
2 Comcast (total) USA 20,017 2 Comcast (total) USA 15,433
3 Charter merged (total cable) USA 15,589 3 Charter merged (total cable) USA 11,942
4 DISH Network (satellite) USA 12,310 4 DISH Network (satellite) USA 10,381
5 China Radio & TV (total) China 8,562 5 China Radio & TV (total) China 7,405
6 Sky (satellite) UK 5,258 6 Sky (satellite) UK 4,613
7 Verizon Fios (IPTV) USA 3,857 7 China Telecom (IPTV) China 3,753
8 Cox (total) USA 3,691 8 Sky (satellite) Brazil 3,662
9 Sky (satellite) Brazil 3,586 9 Verizon Fios (IPTV) USA 3,268
10 Altice USA (total cable) USA 3,190 10 Cox (total) USA 2,829

Source: Digital TV Research

Analyst: US pay-TV revenues to fall by $27bn

US pay-TV revenues peaked in 2015, at $101.71 billion (€82.51bn), according to the eighth edition of the North America Pay TV Forecasts report from Digital TV Research. A $26.58 billion decline (26 per cent) is forecast between 2015 and 2023 to take the total down to $75.13 billion.

Cable TV revenues peaked in 2010 at $54.11 billion, but they will fall to $36.75 billion by 2023. Cable will lose nearly 12 million subscribers between 2010 and 2023 (although most of the heaviest losses have already taken place).

“Cable TV is not the only platform to suffer,” noted Simon Murray, Principal Analyst at Digital TV Research. “Satellite TV and IPTV are also losing subscribers and revenues. Much of this is due to the operators shifting their subscribers to online platforms. However, growth from vMVPDs is not expected to make up completely for the subscriber and revenue shortfalls from traditional pay-TV.”

IPTV’s fall is mainly as a result of AT&T encouraging its U-Verse subscribers to convert to DirecTV, its other pay-TV asset. This is the reverse of what has happened in most other countries. IPTV revenues spiked in 2015 at $9.60 billion, and they will halve to $4.77 billion in 2023. The number of IPTV subs topped 12 million in 2014, but it will decline to 6.26 million in 2023.

Satellite TV revenues will fall from $39.78 billion in 2017 to $33.61 billion in 2023 – or down by 16 per cent. Satellite TV subscriptions will drop by 4.08 million between end-2017 and 2023; having fallen by nearly 3 million in 2017 alone. DISH is pushing its vMVPD platform Sling TV hard, with DirecTV Now also making an impact.

The number of US traditional pay-TV subscribers will fall from a zenith of 100.34 million in 2012 to 90.35 million by end-2017 and down to 80.33 million in 2023. Pay-TV penetration will fall from 87.6 per cent of TV households in apex year 2013 to 66.7 per cent in 2023.

Although Canada is losing pay-TV subscribers, its problems are not as severe as its Southern neighbour. Pay-TV penetration reached a high point in 2013 at 85.1 per cent. The level will fall to 74.8 per cent by 2023. However, the number of pay-TV subscribers will be 11.17 million by 2023 – about the same as 2017. Pay-TV revenues will fall from a peak of $6.82 billion in 2015 to $6.01 billion by 2023.

Skinny bundles to herald new age of pay-TV as a third of US consumers willing to stream services

A new study from Horowitz Research has revealed clearly the new normal in US TV, showing that 70% of TV viewers aged over 18, and 90% of 18-34-year-olds stream some of the content they watch.

Horowitz believes that over the past decade, the pay-TV landscape has undergone a radical transformation, propelled by Netflix’s and the critical mass adoption of other streaming services. Now, in the latest edition of its State of Pay TV, OTT & SVOD annual survey, the analyst sees the pay-TV industry on the verge of another tipping point ever since. According to the company’s, the industry is about to enter a new phase as the introduction of the likes of Hulu with Live TV and YouTube TV signal a new era of competition to traditional cable, satellite, and fibre optic TV providers.

The study shows that 29% of TV content viewers express interest in subscribing to one of these so-called dMVPDs; 30% of them among traditional pay-TV subscribers from cable, satellite and fibre operators. Most crucially, just over three-quarters of those interested in a dMVPD say that in order to consider the service, the overall cost will need to be lower than having a cable or satellite subscription.

When asked which features are most essential in making the decision to subscribe to a dMVPD, respondents listed as top features live TV, local broadcast channels, regional sports networks, DVR, and a variety of cable networks. In other words, facets associated with normal TV. Also considered essential were features that are often antithetical to traditional TV services: Not requiring a contract, not requiring additional hardware such as a dish or set top box, and having the ability to access your entire service on various devices simultaneously, both in and out of the home.

read more here:

www.rapidtvnews.com/2017062947801/skinny-bundles-to-herald-new-age-of-pay-tv-as-a-third-of-us-consumers-willing-to-stream-services.html#axzz4lOini8wb

Global pay-TV subscribers total 969MN in 2016

A study from Digital TV Research has found that 2016 saw an estimated 254 million additional pay-TV subscribers between 2010 and 2016, an increase of 35%, to take the global total to 969 million.

The Global Pay TV Subscriber Databook found that digital cable TV created the most additions by platform – at 256 million between 2010 and 2016 just as analogue cable TV lost 218 million, dampening overall cable gains. There were 76 million extra subs for IPTV to nearly quintuple its total. Satellite TV added 77 million subs and pay-DTT five million. The survey also showed that excluding analogue cable TV, the digital pay-TV market rocketed from 380 million subscribers in 2010 onto 852 million at end-2016.

Looking at regions, the survey found that pay-TV subscriber counts doubled in 53 countries between 2010 and 2016. The Asia Pacific was the world’s largest pay-TV subscriber region, contributing three-fifths to the global total. China supplies about a third of the world’s pay-TV subscribers, with 313 million by end-2016. However, the research also noted that pay-TV subscriber numbers fell in nine countries, with the US down by 4.4 million and Italy by 2.3 million.

Research: US broadband subs surpass pay-TV

According to the latest findings from specialist broadband, media and entertainment industries analyst firm Leichtman Research Group (LRG) the fourteen largest cable and telephone providers in the US – representing about 95 per cent of the market – acquired about 960,000 net additional high-speed Internet subscribers in Q1 2017.

These top broadband providers now account for 93.9 million subscribers – with top cable companies having 59.4 million broadband subscribers, and top telephone companies having 34.5 million subscribers.

Findings for the quarter include:

Overall, broadband additions in Q1 2017 were 85 per cent of those in Q1 2016
The top cable companies added about 1,000,000 subscribers in Q1 2017 – 90 per cent of the net additions for the top cable companies in Q1 2016

The top telephone companies lost about 45,000 subscribers in Q1 2017 – compared to a gain of about 10,000 broadband subscribers in Q1 2016

Telco providers have had net broadband losses in seven of the past eight quarters
Over the past year, there were about 2,530,000 net broadband adds — compared to about 3,035,000 over the prior year

“With the addition of nearly one million subscribers in the quarter, the top cable and telco broadband providers in the US cumulatively now account for over 93.9 million subscribers in the US,” said Bruce Leichtman, president and principal analyst for LRG. “In the first quarter of 2017, the number of broadband subscribers surpassed the number of pay-TV subscribers in the US.”

read more here:

http://advanced-television.com/2017/05/22/research-us-broadband-subs-surpass-pay-tv/

US pay-TV penetration set for slide

The US and Canadian pay-TV markets are set for serious headwinds as the industry is hit by subscribers dropping services and a significant rise in on-pay homes, says Digital TV Research.

In its North America Pay-TV Forecasts report, the analyst forecasts that the number of pay-TV subs in North America will fall by ten million from 112 million in the peak year of 2012 to 102 million in 2022, a 9% decline. Though it says that this is evidence of a massive cord-cutting problem in itself, there will also be a steep rise in the number of non-pay homes during this period. These are expected to hit 41.56 million by 2022, nearly double the amount over the same research period. The total number of TV households will increase by 11 million meaning that pay-TV penetration will drop from the peak of 87.4% in 2013 to 75.2% by 2022.

The research company adds that the number of pay-TV subscribers declined by two million in both 2015 and in 2016, and that the 2022 total will be five million lower than the end-2016 total. However, it noted that the rate of decline is actually slowing.

“Where are the lost subscribers in the decade to 2022 going?” asked Simon Murray, principal analyst at Digital TV Research. “Some analogue cable subscribers will give up paying for TV services rather than convert to an often more expensive digital platform. Cord-cutting is also a factor. It has been somewhat exacerbated by the traditional pay-TV operators starting their own OTT platforms: satellite TV platform Dish provides Sling TV and DirecTV Now has recently started. Other distractions include Hulu, HBO Now and, of course, Netflix and Amazon Prime Video.”

read more here:

https://www.rapidtvnews.com/2017032746628/north-american-pay-tv-penetration-set-for-slide-over-next-five-years.html#axzz4cWRo57Iz

64% of Adults Use an SVOD Service, up 8%

Subscription video-on-demand (SVOD) viewing is increasing at a fast rate, with 63.8 percent of adults now using a service. That shows an increase of 8.4 percent from the previous year.

That data comes from TiVo’s Q4 2017 pay TV and online video trend report, which used a third-party company to survey 3,079 adults 18 and over in the U.S. and Canada.

The most popular SVOD is Netflix with 52.8 percent of those surveyed, followed by Amazon Prime with 26.3 percent and Hulu with 11.8 percent.

People are overwhelmingly happy with their SVOD’s selection: 92.5 percent watch SVOD content daily, a year-over-year increase of 2.3 percent, and they’re watching more content on a daily basis than they did previous year. Also, 81.2 percent are happy with their ability to find SVOD content they want to watch, showing a slight year-over-year improvement.

The majority of SVOD subscribers (55.6 percent) pay between $6 and $14 per month. But many would like more of a deal: 68.0 percent said if Netflix or Hulu offered a free tier with commercials, they would consider using it. This number shows a slight decrease from the previous quarter. Of the 32.0 percent who wouldn’t consider a free commercial-sponsored tier, 85.1 percent don’t even want commercials targeted to their interests.

read more here:

http://www.streamingmedia.com/Articles/News/Online-Video-News/64-of-Adults-Use-an-SVOD-Service-Up-8-From-the-Previous-Year-116819.aspx?CategoryID=430

Sky: ‘Discovery demanded £1bn’

Sky has hit back in its carriage dispute with Discovery, which threatens to see the removal of 12 of the programmer’s channels from its pay-TV and NOW TV services, accusing it of “misleading claims and aggressive actions”.

In a Statement posted on its website, Sky says it has worked “really hard” for more than a year to get a deal done for its customers with Discovery, saying it is disappointed with its misleading claims and aggressive actions. “We now feel it’s time to set the record straight. Because despite our differences, we love Discovery too,” declares Sky.

 

It says it was prepared to pay “a fair price” for the Discovery and Eurosport channels and invest more in those channels to make them even better for its customers. “We have offered hundreds of millions of pounds to Discovery, a $12 billion (€11.3bn) American business, but that wasn’t enough. They asked the Sky Group to pay close to £1 billion for their portfolio of channels, many of which are in decline,” it claims.

“Sadly, we have now had to prepare for Discovery to take their channels away from Sky customers, as they have threatened to do. It is Discovery’s choice to do this, not ours. We never left the negotiating table and they haven’t come back to it since they made their threats public this week,” it advises.

“Sky doesn’t boot channels off our platform. If Discovery don’t want their channels to disappear, as their public campaign suggests, they could have made arrangement to stay on Sky, including free to air with advertising funding or with their own subscription, but they’ve chosen not to do so,” it says.

“Our commitment to our customers is this: We will spend every penny that we were going to pay to Discovery on more and better content that our customers value. This will come from sources around the globe and home grown shows and documentaries from the UK. We will continue to offer customers a huge range of content including hundreds of shows from The History Channel, National Geographic, PBS, Sky Arts and Sky Atlantic, along with more amazing sport on Sky Sports Mix, available to all our customers,” it states.

read more here: http://advanced-television.com/2017/01/30/sky-explains-discovery-carriage-stance/