8 Percent of Households Cancelled at Least One Service Since the Start of the Pandemic

Stephen Silver

Economics, Americas

With a recession on and sports programming cancelled, many households decided to cut their pay-TV bills.

Research firm Parks Associates found that, as of May, 8 percent of households in the U.S. who have broadband have cancelled at least one video service since the coronavirus pandemic began in earnest earlier in the year.

This was associated in a big way with the lack of sports, which were shut down for several months early in the pandemic, but have since returned.

“The lack of sports programming had a significant role in households cancelling their pay-TV services early in the pandemic,” Jennifer Kent, Senior Director, Parks Associates,” said in the announcement.

“All major leagues have now resumed play, and that should bring back many of these households, especially online pay-TV subscribers, who have an easier path to re-subscribe compared to traditional pay TV. However, the ongoing economic crisis could push additional households to trim services. Service and video providers are shifting to focus on retention and finding ways to keep subscribers through innovative partnerships and unique content.”

Parks Associates will host a “virtual conference” this week, called Future of Video: OTT, Pay TV, and Digital Media, that will discuss these issues, with participants from such companies as ESPN, Vizio, Intel and the NFL.

There’s no question that the pandemic has significantly reordered how Americans get their entertainment. Every cable and satellite company reported massive losses of subscribers in the first two quarters of the year, with no sports happening and stay-at-home orders in effect. Meanwhile streaming services, led by Netflix, showed significant subscriber growth.

These cord cutting trends slowed, somewhat, in the third quarter, with sports returning and lockdowns lifted in much of the country, although the companies did lose a total of nearly 900,000 subscribers on a net basis in the third quarter.

Leichtman Research Group, Inc. (LRG) found that the pay TV companies lost even more subscribers, about 1.57 million, int he second quarter, and two million in the first quarter.

The effect on that market of the resurgent pandemic in the final months of the year—and the promise of vaccines on the way soon—remains to be seen. And many of the cable and satellite companies, while losing pay TV customers, have managed to add huge numbers of home Internet subscribers.

Comcast, for instance, shed 273,000 cable TV subscribers in the third quarter, but added more than 600,000 Internet subscribers, which the company called a record number.

“One of the big pivots of Comcast the last decade is to really follow our customers’ needs and try to anticipate them and be a company that meets them. So in video with some customers who want it all,” Comcast CEO Brian Roberts said at a conference this fall.

Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Image: Reuters.