The US multichannel segment fell by 119,000 customers in the third quarter of 2010, compared to a 346,000 gain reported in third-quarter 2009, according to research by SNL Kagan.
The research estimates US cable operators lost 741,000 basic video customers in third-quarter 2010, marking the single largest quarterly dip for cable since SNL Kagan began compiling data for the segment in 1980. Cable MSO’s share of combined video subscribers continues to slide, dropping to 60.3%, versus 62.9% in third-quarter 2009.
Despite the overall weakening in multichannel subscription trends, IPTV continues to grow, adding 476,000 customers in the third quarter. Although still a modest 6.4%, the IPTV market share is steadily rising, up from 4.7% in third-quarter 2009. The satellite DTH platforms have added 145,000 subscribers in the third quarter, with a market share up less than 1% over the past year to 33.2%.
The third-quarter multichannel market drop-off marks the second consecutive quarter of video subscriber declines. The multichannel market declined for the first time in history when it lost 216,000 customers in the second quarter of 2010. In the past two quarters combined, the segment has fallen 2.3% to just more than 100 million subscriptions, not eliminating overlap of duplicate subscriptions.
“Operators are pointing to a continuation of the forces that pushed subscriber gains into negative territory in the second quarter, including the weak economy, high unemployment and elevated churn of former over-the-air households,” said Ian Olgeirson, senior analyst at SNL Kagan, in a statement. “However, it is becoming increasingly difficult to dismiss the impact of over-the-top substitution on video subscriber performance, particularly after seeing declines during the period of the year that tends to produce the largest subscriber gains due to seasonal shifts back to television viewing and subscription packages.”