Information and data company Nielsen estimated a median decline in pay-TV homes of 1.9% from last year, according to a report by analyst Brian Wieser of Pivotal Research Group and reported by Broadcasting & Cable. That, combined with another 1.7% increase in total TV households put in place for this TV season, brings the gap between TV households and pay-TV households to 3.3% for December—the biggest gap in two years.
Wieser’s analysis of the Nielsen estimates notes that median cable network penetration was down 1.9% year over year, suggesting that more subscribers are paying for fewer channels, according to Broadcasting & Cable. AMC Networks showed the biggest gains in penetration, increasing 1.7% for December. Discovery Communications' networks were down 2.3%. ESPN was down 3.3% and ESPN2 was down 3.4%, and Disney-owned networks saw similar declines in November that were initially disputed by Disney.
Research firm MoffettNathanson also threw some cold water on the numbers in the report, referring to “red herrings and other valuable misinformation,” and stating that the estimates only provide part of the picture. (Nielsen didn't immediately respond to questions about MoffettNathanson's statements.)
“These estimates do not include any subscriber counts from the two leading virtual MVPDs—Sling TV and Sony Vue,” MoffettNathanson said in a report today. “Also, the UEs are, just that, ‘estimates’ of each network’s full distribution drawn from Nielsen’s current census of about 40,000 respondents. We remind investors that given the increasing fragmentation of Pay TV bundles (and the limited disclosure from MVPDs about packages their customers take), Nielsen’s efforts are becoming more compromised. Take note, Nielsen is attempting to provide a universe estimate, not actual paid subscribers of individual networks.”
MoffettNathanson added that “it would be much easier if every company just publicly disclosed their paid subscriber totals rather than publish Nielsen’s estimated subscriber counts (which they themselves publicly question).” Further, Nielsen’s subscriber counts may be especially unhelpful for programmers that have networks carried by new OTT platforms, the firm said.
Indeed, cable, satellite and telecommunications-based subscription video services lost 430,000 customers in the third quarter, according to a recent SNL Kagan report, giving the industry a record year-to-date loss of 1.3 million subscribers. SNL Kagan estimates that Dish Network’s Sling TV added 925,000 customers in the 12-month period ending Sept. 30. Factoring in those users, the research company estimates that MVPD customer ranks have declined by 822,000.