U.S. cable and satellite TV providers lose 380,000 subscribers in Q2.
For cable and satellite TV providers, the second quarter of 2011 was the single worst quarter in history. They lost more subscribers than ever before and competitive pressure also meant that they had to offer more and more freebies to win subscribers. Overall, Reuters reports, the U.S. pay-TV sector lost 380,000 subscribers last quarter. In the same quarter a year ago, the TV providers lost 160,000. Things are even worse for satellite TV providers, as both Dish and DirecTV reported their “first-ever quarter of combined losses of 109,000 subscribers.”
According to Reuters, these losses shouldn’t come as a surprise. Not only are consumers cutting down on cost by getting ride of their expensive cable subscriptions, but alternatives like Hulu and Netflix now enable customers to bypass their cable and satellite subscriptions altogether at a fraction of the cost of a traditional cable subscription.
It’s worth noting, though, that the most advanced networks, the Verizon’s FiOS and AT&T’s U-Verse actually added some customers. Clearly, then, there is still some demand at the high end of the market.
As for cord cutting, Reuters notes that Netflix added 1.8 million subscribers in the second quarter. While it’s still not clear how many of these are actually cord cutters, there can be little doubt that this phenomenon has contributed to the cable industry’s miserable quarter, though the weak economy surely played a much larger role.
Image credit: Nick J Webb.