Forecast: US pay-TV subs down 20% by 2023

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Pay-TV subscriptions in the US are expected to decline by 20 per cent by 2023 according to analysts at media research firm Broadcast Intelligence.

As the SVoD market continues to grow, US pay-TV subscription declines will accelerate compared to the past decade, marking the continuation of an irreversible trend that is reshaping the US television industry.

Broadcast Intelligence’s report Pay-TV’s future in an on-demand world – US Market Edition, analyses the recent performance of the top eight pay-TV providers in the US. It predicts that US traditional pay-TV subscriptions will drop, reaching 62 million by the end of 2023, down from 77 million in 2019.

Analysts reviewed the companies’ content, distribution and platform strategies and forecast their future subscriber and revenue performance.

Over the past decade, pay-TV subscriptions in the US have slowly started to decline, as new and innovative content aggregation and distribution models – most notably SVoD – grew popular among consumers. Between 2011 and 2019, the number of SVoD subscriptions in the US has grown by 22 million to 193 million, while pay-TV subscriptions have declined from 95 million to 77 million.

Insights analyst Jack Genovese said: “Pay-TV is still playing a fundamental role in the TV ecosystem in the US. More than 70 per cent of US households subscribe to pay-TV, and linear viewing still accounts for the vast majority of TV consumption for the average American. TV also remains the largest source of revenue for most of the platform providers, despite broadband subscriptions having surpassed TV subscriptions around the middle of the decade. However, it is hard to see a way for platform providers to reverse the declining trend that has affected the market in the past decade.”

The launch of vMVPDs in the second half of the decade – which effectively replicate the pay-TV model to an entirely OTT setting – aimed to regain some of the pay-TV users that were lost. Broadcast Intelligence analysts estimate the vMVPD market to count 7 million subscriptions in 2019. Although they expect vMVPDs to continue to grow by 2023, reaching 13 million subscriptions in that year, this growth will not make up for the fall in traditional pay-TV subscriptions expected over the same period.

Furthermore, vMVPDs are typically cheaper services than traditional pay-TV subscriptions, making them unable to make up for the revenue loss caused by traditional pay-TV subscription losses. Broadcast Intelligence estimates that, by 2023, pay-TV revenues will fall by 18 per cent compared to 2019. We expect ARPU growth to slow down significantly compared to the past decade, due to a combination of more intense competition from cheaper services and pay-TV customers shifting to cheaper bundles in order to manage their video expenditure.

Genovese added: “As the role of content continues to evolve to serve new strategic imperatives, traditional platform providers will struggle to compete to provide customers with a compelling content offering for a cheap price. The key to surviving in these difficult circumstances will be to increase the flexibility of the content offering and managing the content cost bill in a way that prioritises customers’ core needs.”


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