Cord cutting slows to only 400K subs a year, report says

Pay-TV operators survived the second quarter, typically their weakest for subscriber growth, with their customer bases largely intact. And the much discussed specter of cord cutting has "slowed to a crawl."

So says media analyst Craig Moffett, who noted in a report released Thursday that cord cutting has decelerated to a rate of only around 400,000 consumers a year.

"Cord cutting trends in Q2 remained surprisingly benign," Moffett wrote. "Over the past year, the number of pay-TV subscriptions in the U.S. has barely budged. That may not sound like a reason for celebration, but it is a small but discernible improvement from recent trends when the number of pay TV subscribers was actually shrinking (albeit slowly)."

All told, according to the MoffettNathanson Q2 tally, U.S. pay-TV services lost 305,000 video subscriptions during the three-month period, compared to 387,000 in Q2 2013.

Migration to telco-based services seems to be slowing, too. Cable lost 517,000 video subs compared to 598,000 in the year-ago period, while satellite was down 78,000 compared to 168,000 last year in the second quarter. AT&T and Verizon added 290,000 video subs in Q2 vs. 373,000 in Q2 2013.

Revenue and ARPU growth trends also held steady, the analyst noted, with the pay-TV business expanding by 3.7 percent in the second quarter.

"And here is an interesting, and perhaps surprising factoid," Moffett added. "The 'dying dinosaur' pay-TV industry is growing revenue more than twice as fast as the wireless industry (after adjusting for accounting distortions in wireless).

For more:
- read this MoffettNathanson report (sub. req.)

Related links
Consumers have reached price limit, but cord cutting isn't a problem yet, panel says
Connected TV set owners more likely to ditch pay-TV, Diffusion Group says
'Pay TV refugees' seen populating 13% of U.S. broadband households