A pick up in speed in traditional multi-channel defections is being cited by research firm Kagan as the prime reason for an estimated loss of 802,000 subscriptions in the first quarter of 2017.
Worryingly, the company’s First Quarter US Multichannel Subscriber Report calculated that this represented a 0.8% decline in what has historically been a strong first three months of the year.Key drivers of the drop were found to include the impact of new streaming options which, said Kagan, suggests an important component of the loss comes from a shift in platforms within the familiar subscription construct rather than outright cord-cutting. The estimated total of traditional multi-channel subscriptions fell to 97.0 million in the first quarter. Adding estimated subscribers from virtual services including Sling TV, DirecTV Now and PlayStation Vue, brought the combined total subscriptions to a package of live linear channels and on-demand content to 99.2 million.
Assessing how individual platforms performed, Kagan found that cable operators posted their worst first-quarter performance since 2013, losing 188,000 total video customers. Yet this was a smaller loss than posted by direct broadcast satellite (DBS) and telecommunications (telco) competitors.
After full-year gains in 2016, the DBS segment stumbled in Q1. Those that launched virtual service provider (VSP) alternatives lost a combined 291,000 subscribers in the quarter. Due to prominent retreats from the multichannel business by leading players, the telco sector lost 324,000 subscribers in the first three months of the year.
