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The proof is in the pudding and research firm SNL Kagan reported Wednesday that US cable TV operators lost 741,000 customers in the third quarter... the single largest quarterly drop for cable since the research firm began compiling data for the segment in 1980.
And Big Cable’s share of the multichannel pay television market is continuing to tank, dipping to 60.3% from 62.9% in Q3 2009.
New customers in telecom and satellite TV services were not enough to offset the loss of cable subscribers, and the overall multichannel pay-TV market trimmed 119,000 customers, marking the second straight quarter of video subscriber losses for the traditional pay-TV business - the first two months there has ever been decline in the industry - as we reported last month here. Pay-TV pundits are still pointing fingers at the weak economy and high unemployment as the reason for the decline - and it appears that The cable industry is also not willing to pull its own head out of the sand.
SNL Kagan says over-the-top TV services such as Netflix and Hulu — video delivered over broadband Internet, some free and some fee — are having an impact. Not to mention Connected TVs, Blurays, Smart TVs etc.
The decline will be likely to continue with competition from the likes of Hulu Plus as we reported on today, which just cut its online subscription price by 20 per cent to $7.99 per month, and Netflix which is testing a $7.99 per month streaming-only service and is growing in leaps and bounds.
“It is becoming increasingly difficult to dismiss the impact of over-the-top substitution on video subscriber performance, particularly after seeing declines during the period of the year that tends to produce the largest subscriber gains due to seasonal shifts back to television viewing and subscription packages,” Ian Olgeirson, an SNL Kagan analyst, said in a statement.