Pay TV is going extinct
It's a cord cutting nation
Pay TV as we know it is about to disappear
No wonder ESPN is getting serious about transitioning to streaming: Cable and other traditional pay TV subscriptions are in freefall, and quickly becoming something of an anomaly. Dollars spent on streaming services are not yet matching the money Americans are forking over for pay TV, but that’s about to change soon as well.
That’s the gist of the Convergence Research Group’s new Battle for the North American Couch Potato report, which came out a few days ago. Here are some highlights:
7.37 million U.S. households cut the cord in 2022, and Convergence is forecasting a decline of 8.24 million TV subscriptions for 2023.
Cord cutting is continuing to accelerate: “US TV subscribers declined by 11% in 2022, and we forecast 14% in 2023 and 16% in 2025,” the report states.
Already, a majority of households (53 percent, to be precise) doesn’t have a traditional pay TV subscription. By the end of 2025, that number is expected to rise to 72 percent.
Pay TV providers and cable networks made up for those losses with fee hikes in the past, but that’s not a feasible strategy anymore either (if it ever was).
Cable, satellite and telco TV access revenues declined by 6 percent to $85.8 billion in 2022, according to the Convergence Research Group.
Those revenues are forecast to decline by 9 percent this year, and by 13 percent in 2025.
Money spent on online video services grew 26 percent to $49.6 billion last year, and is expected to grow 21 percent this year.
Online video subscription revenue growth will slow to 13 percent in 2025, but by that time, the money spent on services like Netflix and Disney+ will “well exceed” what consumers spend on pay TV.
Projecting out until 2028, the report estimates a whopping 70 percent decline of TV subscriptions, accompanied by a 60 percent TV subscription revenue decline.
The number of cord cutter / cord never households will nearly double over the same time span, according to the Convergence Research Group.
“Traditional TV access is well into becoming a niche product,” the report concludes. Notably, that’s true even if subscriber numbers for online TV services like YouTube TV or Fubo are included.
This article was first published as part of Lowpass, a weekly newsletter about AR, VR, streamind and more. Sign up now for free.
Image credit: Photo by Possessed Photography on Unsplash.