Pay TV losses continued to mount in the third quarter of 2022. A new report from media research firm Leichtman Research Group (LRG) shows that the largest pay-TV providers combined for a loss of 785,000 subscribers in Q3. The most surprising data point from Leichtman’s report is that losses for pay-TV providers actually slowed down in Q3.
The top providers (including Comcast, Charter, and Cox Media) now report a total of about 71.4 million subscribers – with the top seven cable companies accounting for roughly 38.6 million, other traditional pay-TV services having about 24.8 million, and the top, publicly reporting live TV streaming services (also known as virtual multichannel video programming distributors (vMVPDs)) tallying over 8 million subscribers. By comparison, the leading streaming service in the world (Netflix) now boasts over 223 million global users.
Household penetration of pay-TV in the United States is at its lowest point since 1993, and the rate of customers leaving pay TV has increased 18% year-over-year. But the quarter-over-quarter losses dropped in Q3, and providers largely have live TV streaming services to thank.
The lower rate of defection for pay-TV providers was driven mostly by live streamers, which managed to add customers at a higher rate than many of the top cable and satellite providers. Hulu + Live TV led the way by adding 400,000 subscribers in Q3. LRG’s data does not include YouTube TV and Philo, as those companies do not regularly disclose their subscriber numbers.
| Service | Subscribers Added in Q3 2022 | Total Subscribers |
|---|---|---|
| Hulu + Live TV | 400,000 | 4,400,000 |
| Sling TV | 214,000 | 2,411,000 |
| fuboTV | 284,265 | 1,231,000 |
“Spurred by a strong quarter from Internet-delivered vMVPD services, pay-TV net losses of about 785,000 in 3Q 2022 were more modest than in the first two quarters of the year,” LRG president and principal analyst Bruce Leichtman said. “Not including YouTube TV, which does not regularly report subscriber totals, vMVPDs had nearly 900,000 net additions in the quarter. This was the third most quarterly net adds ever for the top publicly reporting vMVPD services.”
There’s likely another factor involved in the slower rate of decline for pay-TV sources in Q3: live sports. The NFL, NBA, and NHL all started their regular seasons in Q3, and each league has lucrative deals in place with major linear broadcasters to carry their games. Cable, satellite, and vMVPDs all see seasonal subscription increases during the football season especially.
The numbers from LRG are something of a gift to pay-TV providers, but that gift may not last long past the holidays. It will bear watching to see if losses accelerate again for such providers in the last quarter of 2022, as the NFL year winds down and tax season, with all of its budget-evaluating implications, begins.