US Cable Companies Lost 5 Million Paying Customers Last Year Alone

from the denial-isn't-just-a-river-in-Egypt dept

For most of the last decade, cable and broadcast industry executives insisted that "cord cutting" (users cancelling traditional TV and moving to antennas or streaming) either wasn't real or was only something losers did. Many of the analysts and viewer tracking firms (like Nielsen) -- which have a financial stake in telling cable and broadcast executives what they wanted to hear -- were quick to happily parrot these denials.

Now that it's impossible to deny the trend, most of those folks have become notably quiet.

This week Leichtman Research took a final look at 2019 earnings reports for the biggest cable companies and it wasn't particularly pretty for the sector. All told the top pay TV providers in America, representing about 95% of the market, lost about 4,915,000 net video subscribers in 2019--compared to a loss of 1,585,000 subscribers in 2018. Satellite TV providers were particularly hard hit last year.

Among the biggest hit was AT&T's DirecTV, which lost 3,190,000 subscribers last year alone. Most of those losses were courtesy of the rate hikes AT&T imposed on its customers to pay off the debt it accumulated after spending $150 billion on megamergers in the last five years alone (DirecTV in 2015, Time Warner in 2019). Instead of dominating the space as AT&T had hoped, it "enjoyed" a revolt from customers and investors alike.

But things weren't much better for the cable sector, which collectively lost 1,560,000 video subscribers in 2019 -- compared to a net loss of about 920,000 subscribers in 2018. Or the nation's traditional phone companies like Verizon and AT&T (who also offers TV service via IPTV), who lost 665,000 subscribers last year -- compared to 245,000 the year before. Even the companies that tried to at least somewhat get ahead of the trend (like AT&T) wound up paying the price, even losing subscribers from their new streaming TV platforms due to rate hikes.

It's always been pretty clear that most cable TV providers intend to ride this cash cow until its last gasp before doing obvious things like shoring up historically terrible customer support or actually competing on price. And to some degree, you can understand why. The traditional pay TV sector is still home to a whopping 86.2 million subscribers with the top seven cable companies still laying claim to 45.8 million video subscribers, satellite TV services 25.4 million subscribers, and the top telephone companies 8.3 million subscribers.

And while streaming will continue to slowly erode these totals, these companies all have an ace in the hole: their growing monopolies over broadband. The lack of US competition means that as margins on TV get tighter, they can simply squeeze their captive broadband customers tighter, something that usually manifests in not just vanilla price hikes, but the steady growth of bullshit fees, usage caps, and utterly arbitrary and unnecessary usage caps and overage penalties.

Filed Under: cable, cord cutting, tv


Reader Comments

Subscribe: RSS

View by: Time | Thread


  1. icon
    Scary Devil Monastery (profile), 13 Mar 2020 @ 7:13am

    Re: I don't get it.

    "Are there any non-utterly arbitrary/unnecessary usage caps?"

    Not really, no. It's not as if data transmission causes much in the form of wear'n'tear.

    The only limitation has ever been bandwidth. Usage caps MAY serve a secondary purpose in keeping people from actually using the oversold bandwidth they've paid for but the carrier doesn't have the capacity to deliver fully.

    Primarily it's just been yet one more way to include a surcharge for no reason at all.


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Special Affiliate Offer

Advertisement
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Advertisement
Report this ad  |  Hide Techdirt ads
Recent Stories
Advertisement
Report this ad  |  Hide Techdirt ads

This site, like most other sites on the web, uses cookies. For more information, see our privacy policy. Got it
Close

Email This

This feature is only available to registered users. Register or sign in to use it.