Is “Traditional” Pay-TV Doomed?

We certainly hope so. That doesn’t make us bad people, does it? Why does this question keep rearing its head on TVWriter™ and other sites as well? This is why:

bustedtvby Andrew Meola

The cord-cutting generation is truly starting to cause problems for satellite TV provider Dish Network, if the company’s latest quarterly report is any indication.

The company announced in its 2015 financial report that its total video subscribers fell by 12,000 in the fourth quarter. Dish lost 81,000 pay-TV subscribers in 2015, up form 79,000 in 2014.

Those figures are even more worrisome when you consider that Sling TV, the company’s over-the-top streaming service, remained strong but still couldn’t help Dish overcome the subscriber loss.

Sling is one of the many “skinny bundles” on the market that provide broadband customers with a limited number of television channels for a lower monthly cost. Traditional TV providers have been heavily promoting these bundles recently as more and more customers, particularly younger ones, forego more expensive TV packages in favor of Internet-only television viewing.

Dish does not specifically highlight how many of its pay-TV customers subscribe to Sling TV, but the Wall Street Journal estimates that the figure is almost 600,000.

Dish’s rivals, meanwhile, showed growth where Dish reported troubles. Comcast announced that nearly 25% of its new video subscribers signed up for a skinny bundle.

The company added 89,000 video subscribers in the fourth quarter, a massive increase from 6,000 in the same quarter of 2014.

Verizon announced that one-third of its revenue for its Fios Video cable TV service came from its skinny bundle, Custom TV. The company added 20,000 net new Fios video connections in the fourth quarter.

Dish’s latest quarterly and yearly figures demonstrate how modern television viewers’ consumption habits are rapidly changing. Each year, more customers are abandoning their pay-TV packages and moving toward subscription video on-demand (SVOD) services….

A report from Margaret Boland of Business Insider Intelligence examines how the growth of SVOD services is coming at the expense of the pay-TV industry. The report analyzes the state of the pay-TV industry and maps out which demographics are more likely to stop buying traditional TV packages.

Here are some of the key takeaways from the report:

  • Those abandoning pay-TV packages fall into three main groups: cord-nevers, cord-cutters, and cord-shavers. Whereas video streaming services have found favor with younger viewers in particular, an increasing portion of older subscribers also are leaving behind their pay-TV packages. Still, younger viewers watch four times as much video content online than older viewers.

Read it all at Business Insider