Payments Industry News

Pay-TV in crisis: Pay television is dying – at record speed

Classic Pay-TV is dying a dramatic death as streaming takes over as the central form of television. This shift is not only happening in traditional TV, but also in the world of pay-TV. While pay-TV has always played a minor role in Europe, it has been a dominant force in the US market for years. However, with the rise of streaming, the landscape has completely changed. Cordcutting, the act of cutting cable subscriptions, has become a major topic in the US media world.

According to market research company MoffettNathanson, the number of pay-TV subscriptions cancelled in the third quarter of last year reached an all-time high. In fact, the pay-TV industry shrank by a staggering 7.3%, marking the largest decline since this negative trend began in 2018. This translates to a loss of 1.97 million pay-TV customers.

As a result, the penetration of pay-TV in US households now stands at just 54.8%, a level not seen since 1989. It’s worth noting that this crisis is not solely due to internet distribution and streaming. “Virtual Multichannel Video Programming Distributors” (vMVPDs) like YouTube TV are also considered pay-TV.

While vMVPDs are growing (1.08 million customers were added in the third quarter), they are not expanding at a rate that can compensate for the decline in cable subscriptions.

In summary:
– Streaming is becoming the main form of television.
– Pay-TV is losing significant importance.
– Cordcutting is dominating the US media landscape.
– The largest decline in pay-TV customers since 2018.
– A 7.3% decrease in the last quarter.
– US households with pay-TV are at a level last seen in 1989.
– vMVPDs like YouTube TV are unable to offset the losses.

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It’s clear that the days of classic pay-TV are numbered, as streaming continues to take over the television industry.