Research from the Leichtman Research Group (LRG) has found that 2016 was an annus horribilis for the US pay-TV industry, with losses in subscribers almost doubling year-on-year.





The survey of providers, representing about 95% of the pay-TV market (around 93.6 million subscribers), revealed that the industry lost about 795,000 net video subscribers in 2016, compared with a pro forma loss of about 445,000 subscribers in 2015.In Q4 2016, the top pay-TV providers added about 140,000 subscribers, about the same as in the corresponding quarter a year previously. Yet traditional pay-TV services lost about 330,000 subscribers in the quarter, compared with a small gain of about 1,000 in 4Q 2015. Excluding online-based services such as Sling TV and DIRECTV NOW, traditional pay-TV services lost about 1.64 million subscribers over the year compared with a loss of about 980,000 in 2015.Looking at the key platforms, LRG calculates that the top six cable companies ended the year with over 48.6 million video subscribers, satellite TV services about 33.5 million subscribers, the top telcos 10.1 million subscribers, and the top Internet-delivered pay-TV services having about 1.4 million subscribers.The cable industry seems to have stemmed the haemorrhaging of losses, with the industry’s top six companies losing about 280,000 video subscribers in 2016, compared with 410,000 in 2015 and 1.2 million in 2014. LRG noted that there were fewer losses than at any time over the last ten years. Similarly, it was a year of losses for the telco providers who collectively lost 1.555 million video subscribers in 2016. This compared with a loss of about 120,000 in 2015, and a gain of about 1,065,000 subscribers in 2014. Largely due to parent AT&T's focus on higher margin, DIRECTV subscribers U-verse lost 1,359,000 subscribers in 2016, compared with a loss of about 300,000 subscribers in 2015.By contrast, the satellite industry totally turned things around over 2016, adding 190,000 subscribers, compared with a loss of about 450,000 in 2015. Boosted by parent AT&T’s focus, DIRECTV added 1.228 million subscribers in 2016, compared to only 167,000 net adds a year before. The online-delivered services added about 845,000 subscribers in 2016 -- compared to about 535,000 net adds in 2015.“The pay-TV market has seen significant change in the past two years, with the introduction of Internet-delivered services, and share shifts among traditional providers that are driven as much by providers' decisions as by changes in consumer demand,” said LRG president and principal analyst Bruce Leichtman. “When analysing the pay-TV market, it is now essential to include Internet-delivered services as part of the industry, just as it was important to include satellite and telco services when those new forms of delivery were introduced.”