Market Overview

Strategy Analytics: U.S. vMVPDS Add 868K Subscribers in 2Q 2018 but Overall Pay TV Subscribers Fall

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Strategy Analytics' analysis of pay TV subscriber numbers shows
vMVPDs with 868K net adds in 2Q 2018 bringing the total number of vMVPD
subscribers to 6.73M, up 119% YoY.
Despite this, overall pay TV
subscribers (cable, satellite, IPTV, vMVPD) fell to 93.78M, breaking a
string of two consecutive quarters of growth, according to Strategy
Analytics' Television & Media Strategies (TMS) report, "U.S. Pay
TV and Video Subscriber Update - 2Q 2018
," which examines the
subscriber bases of 27 public traded and private pay TV operators,
accounting for 97% of all pay TV subscriptions. https://www.strategyanalytics.com/access-services/media-and-services/in-the-home/tv-media-strategies/tv-media-strategies/reports/report-detail/us-pay-tv-and-video-subscriber-update-2q-2018

This press release features multimedia. View the full release here:
https://www.businesswire.com/news/home/20180821005490/en/

Pay TV Subscribers YoY by Quarter (Graphic: Business Wire)

Pay TV Subscribers YoY by Quarter (Graphic: Business Wire)

"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, 2Q 2018 was not particularly kind to legacy pay TV
providers (e.g., cable, satellite, IPTV) as they lost nearly as many
subscribers (-973K) as the prior two quarters combined (-1.16M). In 2Q
2018, total legacy pay TV subscriptions fell to 87.05M, down 3.6% YoY.

"Historically, pay TV in the U.S. 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."

(in Millions)     2Q 2017   3Q 2017   4Q 2017   1Q 2018   2Q 2018  

%
Change
YoY

Pay TV Subscribers     93.332   93.051   93.564   93.894   93.789   0.5%
                           

Legacy Pay TV

Subscribers

    90.259   89.187   88.712   88.024   87.051   -3.6%
                           
Cable Subscribers     47.421   47.092   47.025   46.778   46.347   -2.3%
Satellite Subscribers     32.326   31.771   31.488   31.115   30.637   -5.2%
IPTV Subscribers     10.511   10.323   10.198   10.130   10.066   -4.2%
vMVPDs Subscribers     3.073   3.864   4.852   5.870   6.738   119.3%
Sling TV     1.862   2.037   2.212   2.303   2.344   25.9%
DIRECTV NOW     .491   .787   1.155   1.467   1.809   268.4%
Hulu Live TV     165   .330   .495   .745   .955   478.8%
PlayStation Vue     .467   .535   .602   .670   .745   59.4%
YouTube TV     .087   .175   .262   .350   .410   368.6%
fuboTV     -----   -----   .125   .235   .325   n/a
Philo     -----   -----   -----   .100   .150   n/a

Source: Company Reports, Strategy Analytics Estimates, 2Q 2018
Subtotals
may not add up to the total due to rounding

Numbers in
Italics are based upon Strategy Analytics estimates

About Strategy Analytics

Strategy Analytics, Inc. provides the competitive edge with advisory
services, consulting and actionable market intelligence for emerging
technology, mobile and wireless, digital consumer and automotive
electronics companies. With offices in North America, Europe and Asia,
Strategy Analytics delivers insights for enterprise success. www.StrategyAnalytics.com

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