TV cord-cutting accelerating over next two years - new report

  • Cord-cutting is set to get even worse for legacy pay TV providers this year and next, according to a report from S&P Global.
  • Legacy MVPDs (cable, satellite and telco) are set to lose 8.2% of their subscribers, up from losing 7.9% in 2019 - and are set to shed another 10.3% in 2022.
  • Those losses are coming heavily from bigger cable operators, and that pace is set to continue for cable as the report observes "the sector is increasingly indifferent as to whether unprofitable customers get their video service from cable companies or a third-party service."
  • Charter (NASDAQ:CHTR) was an outlier, gaining subs in 2020, but will lose about 4% in 2021, the report says (and it expects the company to use "skinny" bundling to keep a lid on those losses).
  • And pay TV losses are widely expected to be made up for by streaming gains in live services like Hulu Plus Live TV and YouTube TV, but only somewhat, Jon Lafayette notes.
  • S&P believes those virtual MVPDs will grow by 15.7% this year and 12.3% next year. Overall, the pay TV universe will have shrunk 4.5% for 2020 and 6% for 2021.
  • Pay TV providers: Comcast (NASDAQ:CMCSA), Charter (CHTR), DirecTV/U-verse (NYSE:T), Dish Network (NASDAQ:DISH), Verizon FiOS (NYSE:VZ), Optimum/Suddenlink (NYSE:ATUS), Atlantic Broadband (OTCPK:CGEAF), Sparklight (NYSE:CABO).
  • Virtual MVPDs: Hulu Plus Live TV (NYSE:DIS), YouTube TV (GOOG, GOOGL), AT&T TV (T), Sling TV (DISH), fuboTV (NYSE:FUBO).

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