current year may be marked by the first-ever pay-TV annual decrease in the number of paid TV subscribers, increasing the fear of the development trend of” cutting the cable ». In the past, owners and top managers of companies working in the field of pay TV, was left in the night except that “baba”. But now he does not sleep tendency, called “cutting the cable».
With the reduction in the growth of the number of subscribers of paid TV platforms, many analysts and investors have made optimistic predictions about that improvement in household incomes could change the situation. These experts refused to believe that “cutting the cable” – a term that describes the phenomenon of failure of pay-TV viewers in favor of watching videos on the Internet – becomes a steady trend.
However, according to The Wall Street Journal, the greater the number of subscribers to pay-TV escapes from rising prices in fast-growing alternative media applications like Netflix, it is clear that the expectations of these experts are not met.
In the second quarter of the total number of subscribers showed an annual decline of 0.10% while the number of households with working people has increased by 0.40%, according to UBS. In the first half of 2013, pay-TV market in the U.S. lost about 208,000 subscribers, while in the first half of 2012 there was an increase of 27,000. Based on these data, UBS predicts that by the end of this year, reducing the total number of subscribers to reach 250,000.
Of course, we can say that these figures – a drop in the sea, consisting of 104 million American households connected to pay-TV platforms, and a tendency to “cut the cable” can begin to take their positions in the future with the growth of the U.S. labor market. However, if the UBS forecasts for 2013 are realized, this year may be the first in the history of pay-TV, marked by an annual decrease in the total number of subscribers.
If the trend of reducing the total number of pay-TV subscribers will grow, it may adversely affect the profitability of the industry , which is already reduced because of the rising cost of content. As a result, it may make providers of cable TV and telecoms to focus more on selling broadband Internet access and satellite providers that do not provide such services, can begin to curtail their activities.
According to a correspondent Mediasat, the tendency of “cutting Cables “can also make channels that receive money from pay-TV platforms, depending on the number of subscribers, cooperate with online video streaming platforms and high-tech companies that are trying to enter the television market – such as Google, Sony, Intel or Apple.
And it seems that the pace of “cutting the cable” more accelerated. The increase in household income during the last 12 months of pay TV has brought about 641,000 new subscribers. If we start from the total volume of the fall of subscribers, it means that from pay-TV services during this period declined to 963,000 subscribers – said Moffett Research. During the same period last year, an increase of the number of household income has brought the industry 587,000 new subscribers, with 455,000 subscribers abandoned the pay-TV service.
Not all pay-TV providers are suffering from what is happening to the same extent. Telecommunications companies AT & T and Verizon have increased in the second quarter of this year, the number of its subscribers to 373,000 people, while in 2012 the number of subscribers of these companies increased by 275,000 people. Loss of cable TV providers have remained at the level of 615 000 people. At the same time, providers of satellite platform Dish Network and DirecTV have lost this year, 162,000 subscribers, well above last year’s losses, which amounted to 62,000 subscribers. Perhaps the most alarming figures, which are caused, most likely, the lack of a package of proposals satellite broadband platforms.
emergence of new technological solutions, such as Dongle Gadget Chromecast from Google or a startup Aereo, apparently only accelerate the trend of “cutting the cable”. And the greater the number of spectators refuses services platform pay-TV in favor of Internet video, the more the trend of outflow of subscribers is transformed from a thin stream into a large deep river.
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