Comcast, Time Warner Cable (TWC), and all other top cable companies lost pay-TV subscribers in 2013, but the companies were able to boost their total broadband Internet subscribers, according to research by Leichtman Research Group.

Comcast and TWC, the two biggest cable companies in the US, combined for 1.1 million lost video subscribers. Comcast finished 2013 with 21.7 million multi-channel video subscribers, down 305,000 according to Leichtman's research. TWC lost 825,000 video subscribers, dropping to 11.4 million.

"The top nine cable companies lost about 1,735,000 video subscribers in 2013—compared to a loss of about 1,410,000 subscribers in 2012," the research said.

At the same time, Comcast added 1.3 million broadband Internet subscribers, to hit a total of 20.7 million. TWC gained 211,000 broadband subscribers, to bring its total to 11.6 million. Comcast's 1.3 million broadband subscriber gain accounted for "49 percent of the total net additions for the top providers in the year," the research said.

A Comcast spokesperson noted that the video subscriber loss of 305,000 in 2013 was an improvement over the loss of 336,000 in 2012. Comcast turned things around in Q4 2013 with a net gain of 43,000 video subscribers, which came after 26 consecutive quarters of subscriber losses.

A TWC spokesperson explained its video subscriber losses in a statement to Ars. "We began to move away from too aggressively priced new customer promotions that alienated some subscribers when their promotional price period ended," the statement said. Additionally, "we experienced a larger than usual video subscriber loss last summer from both the CBS/Showtime blackouts as well as from Journal Broadcasting related blackouts in the Midwest."

TWC has "begun significant upgrades in our largest markets this year which will introduce a more dynamic new TV navigation experience and much more content via On Demand," the spokesperson said.

Cutting the cord, but slowly

While some people are "cutting the cord," opting to get video from online streaming sites instead of traditional video packages, the cable industry's losses aren't replicated in the rest of the multi-channel video provider market. AT&T's U-verse gained 924,000 video subscribers in 2013 to reach a total of 5.5 million, while Verizon FiOS gained 536,000 to reach a total of 5.3 million. DirecTV gained 169,000 subscribers to move up to 20.3 million, while Dish stayed level at 14.1 million.

While cable companies as a whole lost 1.7 million video subscribers, moving down to 49.6 million, the entire multi-channel video market lost only 104,521 subscribers, bringing the total down to 94.6 million. In 2012, the whole multi-channel video market added 175,000 subscribers.

Total broadband subscribers in the US grew by 2.6 million in 2013, hitting 84.3 million. Cable accounts for 49.3 million, and "telephone companies" like AT&T, Verizon, and CenturyLink account for the rest. Most of the phone companies saw small gains in broadband subscribers last year.

"[T]he 17 largest cable and telephone providers in the US—representing about 93 percent of the market—acquired over 2.6 million net additional high-speed Internet subscribers in 2013," Leichtman Research Group said. "Annual net broadband additions in 2013 were 95 percent of the total in 2012."

The fact that "broadband is still growing, while video is flat, is largely a function of where the two are in the adoption curves, [rather] than [being] directly related to each other," researcher Bruce Leichtman told Ars in an e-mail. "Much of cable broadband growth is coming from people upgrading from dial-up and switching from DSL, as well as from new household formation."

The cable industry's video subscriber losses provide further incentive to ISPs and content providers to restrict the amount of video content people can get on the Internet. This strategy has been particularly successful with live sports programming—sports nuts who want to cut the cord would have to survive without live broadcasts of their favorite teams' games. The latest example is this month's NCAA basketball tournament, which is only available for online streaming if you also have a pay-TV subscription.

Comcast is attempting to buy TWC for $45.2 billion, a merger expected to get a thorough antitrust review. While the two companies don't compete against each other in individual cities and towns, and Comcast has pledged to divest itself of three million subscribers to appease regulators, the combined buying power of a merged Comcast and TWC would provide further clout in negotiating contracts with content providers.

Comcast and Time Warner have taken somewhat different approaches in marketing video and broadband services, Leichtman told Ars. "Over the past year+ Comcast’s maintained its strategy of focusing on the bundle of video, Internet, and phone, while TWC de-emphasized the bundle and became more willing to get a broadband-only customer," he said. "In the past year, Comcast also added 768,000 phone subscribers, while TWC lost 218,000 residential phone subscribers."

According to Comcast, 79 percent of its video customers at the end of 2013 subscribed to two services while 44 percent subscribed to all three.

Unlike Comcast, TWC has more Internet than video subscribers. However, that changes when business customers are subtracted from the total. "Note that Time Warner’s totals include business accounts—for residential subscribers only, there are still slightly more video customers than broadband (11,197,000 video vs. 11,089,000)," Leichtman said.