Here’s a little fuel for the cord-cutting/cord-shaving fire:
The 13 largest multi-channel video providers in the United States -– about 94% of the market — lost 105,000 net video subscribers in 2013, but broadband additions were huge.
Worst hit? Cable providers who saw their subscriber numbers tumble by more than 1.74 million subs, 23% more than the 1.41 million they lost in 2012. The industry closed the year with about 49.6 million subscribers.
IPTV service providers – who have some 10.7 million subscribers — gained 1.46 million additional users in 2013.
Satellite providers, meanwhile, which have the second largest subscriber base in the U.S. at 34.3 million, added 170,000 new customers.
“2013 was the first year for multi-channel video industry losses, but the modest losses represent only about 0.1% of all subscribers,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. “While the overall market remains fairly flat, further share-shifting has taken place. Cable providers now have a 52% share of the top multi-channel video subscribers in the US, compared to a 58% share three years ago.”
The more substantive change is in the amount of broadband connections.
LRG said the 17 largest cable and telephone providers in the US –- representing about 93% of the market –- gained more than 2.6 million high-speed Internet subscribers in 2013.
Some 84.3 million U.S. households now have a broadband connection. Cable leads with 49.3 million broadband subscribers, and telcos having 35.0 million subscribers.
During 2013, top cable companies added nearly 2.2 million broadband subscribers; telcos added another 480,000.
Not surprisingly, that isn’t all that concerning to operators. As Cablevision CEO Jim Dolan said last August:
“Ultimately over the long term I think that the whole video product is eventually going to go to the Internet,” Dolan told the Wall Street Journal. “I’m not willing to cede that position now, and I’ve got a lot of customers that buy my video product…[but] the handwriting is on the wall, particularly when you look at young customers.”
Cablevision – the fifth-largest cable operator in the U.S. with some 3 million subscribers – has invested heavily to improve its broadband product, video on demand selection and cloud storage.
“I don’t like to fight trends, I think it’s a losing battle,” he said. “I think you try and take advantage of it.”
Dolan said pay-TV providers are relying too much on bundles of channels that people don’t want to pay for, predicting that the model will mature “badly,” especially as younger consumers opt to watch online video rather than pay for traditional TV services.
Protecting that bundle, he said, is akin to “fighting the wave.”