The analysis follows the recent news that T-Mobile US will begin offering TVision to its postpaid wireless subscribers on November 1.
“The arrival of yet another streaming TV option in the US market is unwelcome news for cable and satellite pay-TV providers, as these providers are seeing their grip on the public continue to loosen. GlobalData predicts that pay-TV households as a percentage of total US households will decline from 65% in 2019 to 47% in 2023, while the number of US pay-TV accounts will drop from 83 million in 2019 to just under 63 million in 2023,” said Tammy Parker, Senior Analyst at GlobalData, a leading data and analytics company.
“T-Mobile feels it can poach cable and satellite pay-TV customers who want to escape bloated, expensive channel packages and long-term contracts, as well as cord-cutters who have already made the jump to over-the-top (OTT) streaming services but may be seeking a better option. However, the new TVision will appeal primarily to T-Mobile subscribers, even once it is made available to all viewers in 2021.
“For one thing, prices will likely be higher for people who do not subscribe to T-Mobile’s wireless service. Furthermore, there are plenty of T-Mobile fans who would love to get a streaming TV service through T-Mobile simply because they are brand loyal or want their wireless and TV services on a single bill. To that end, TVision’s main benefit to T-Mobile could be wireless customer retention, as people who combine services are less likely to churn away to other service providers.
“T-Mobile is taking the skinny bundle approach, but viewers may find that gaining access to everything they want to watch – particularly additional sports channels – will require moving up to more expensive TVision service tiers with fatter, and costlier, channel packages. TVision’s prices, if one wants a full slate of programming, end up being comparable to those of rival streaming TV providers such as YouTube TV or Hulu + Live TV and even traditional pay-TV providers, making the overall offer less than disruptive.
“TVision’s headline-garnering, ultra-inexpensive Vibe TV package, which only has 30 entertainment channels and costs $10 per month plus an optional $5 for 100 hours of DVR cloud storage, may attract highly budget-conscious or cash-strapped customers. However, those types of subscribers are also more likely to be on low-cost prepaid wireless plans rather than T-Mobile postpaid plans, meaning they would not qualify to get TVision until eligibility is expanded next year.”