Cord-cutting headaches for pay TV have now progressed beyond just a dull, throbbing pain.

Cable, satellite and telco TV companies suffered their worst-ever quarterly subscriber declines for the three months ended June 30, collectively shedding more than half a million accounts — an accelerating erosion that’s put new pressure on operators and media companies exposed in the pay-TV biz.

No. 1 satcaster DirecTV, now part of AT&T, disclosed in a 10-Q filing Friday that it lost a net 133,000 U.S. subscribers in Q2, dramatically worse than its decline of 34,000 in the year-earlier period. Overall, traditional pay-TV distributors lost a whopping 566,000 video subs in the quarter, compared with 321,000 in Q2 2014, according to MoffettNathanson estimates.

Historically, Q2 has always been the softest for cable and satellite TV ops. But what should concern the industry is that the number of pay-TV households is now shrinking at an annual rate of 0.7%, compared with 0.1% a year ago, says analyst Craig Moffett. “That may not seem like a mass exodus,” he wrote in a research note, “but it is a big change in a short period of time.” Moreover, the declines come as U.S. household formation has picked up, Moffett noted, meaning pay-TV penetration rates are falling even faster.

The upswing in cable and satellite TV sub losses in Q2, along with Disney’s lowering guidance on affiliate-fee increases, led to a monumental sell-off in media stocks this past week. Shares of Disney, Viacom, Time Warner, 21st Century Fox and other congloms exposed to pay TV plummeted, with the sector losing some $60 billion in value in two days, before the stocks mostly stabilized Friday.

“There is clear and convincing evidence that consumers are increasingly cutting the cord or shaving the cord,” BTIG Research analyst Rich Greenfield wrote in a blog post Friday. “In turn, some of the executive commentary makes you wonder how disconnected from reality they are.”

On Friday, Cablevision Systems CEO James Dolan downplayed cord-cutting fears, after the New York-area MSO reported a relatively light loss of 16,000 video subs (versus 28,000 in Q2 2014).

“I don’t think the sky is falling quite yet, and I think that there is not enough programming weight yet in the Internet and in the over-the-top services that are out there to really entice a mainstream video customer,” Dolan said on Cablevision’s earnings call.

Dolan does not expect to see “a landslide of consumers” dropping pay TV in favor of OTT, he added: “My own prediction is that it will be at least five years for 10% of the market to move, and 10 years for 30% of the market to move.”

But Greenfield wonders if pay-TV execs fully appreciate how quickly consumer behavior is shifting, and whether incumbents are prepared to weather the storm. “The consumer must come first, not the business model, or MVPDs and their programming partners will undoubtedly suffer,” he wrote. “MVPDs likely need to accept that they will become ‘dumb pipes’ as consumers spend less time with traditional video (TV) content.”

One thing seems certain: The hemorrhaging in the pay-TV business is going to get worse before it bottoms out.