IPTV gains 414,000 subscribers; cable loses 711,000 in 2Q

The nation's primary IPTV players, AT&T and Verizon added 414,000 subscribers in the second quarter, as satellite operators gained 81,000 and the cable industry suffered its worst quarter ever, losing 711,000 customers, SNL Kagan said. All told, the industry lost 216,000 subscribers, compared to an increase of 378,000 in the like quarter a year ago, its first overall quarterly loss. Six of eight MSOs reported "worst-ever" quarters for subscriber loss.

The popularity of over-the-top delivery options has increased steadily in recent months, with new research saying Internet TV viewing has doubled from a year ago, and indicating that viewers 18-34 years old increasingly are getting their content over the top. But that same research, from Altman Vilandrie & Co. and Peanut Labs, suggests that OTT availability plays almost no part in cable cutting; only 3 percent of the 18-34 year olds say they have dropped pay-TV subscriptions.

Rondeli also downplayed the impact of OTT, pointing instead to a rocky economy.

"Although it is tempting to point to over-the-top video as a potential culprit, we believe economic factors such as low housing formation and a high unemployment rate contributed to subscriber declines in the second quarter," she said. "We are also seeing churn resulting from the broadcast digital transition, which boosted video uptake early last year, as many have abandoned their paid subscriptions once initial promotional contracts expired."

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