Virtual multichannel services lift third quarter while traditional US multichannel decline slows

Rhea-AI Summary

S&P Global Market Intelligence reported a sequential increase in U.S. households subscribing to live, linear networks by 319,000 or 0.4% in Q3 2020, following a surge in virtual multichannel packages. Traditional providers lost over 1.6 million subs, yet the decline slowed to 2.1%. Virtual services gained nearly 2 million subscriptions, marking a 19% sequential growth. Combined, the penetration of subscriptions reached 67.4%, while traditional multichannel subscriptions fell below 58%. The industry overall remains down 4.6% year-over-year.

Positive

• U.S. households subscribing to live networks increased by 319,000.
• Virtual services gained nearly 2 million subscriptions, a 19% increase.
• Combined penetration of subscriptions rebounded to 67.4%.

Negative

• Traditional providers collectively lost over 1.6 million subscriptions in Q3.
• The industry remains down 4.6% year-over-year, equating to a loss of 4.3 million subscriptions.

NEW YORK, Nov. 17, 2020 /PRNewswire/ -- The number of households in the U.S. subscribing to a package of live, linear networks made gains in the third quarter behind surging popularity for virtual multichannel packages. The combined tally of the broadband-delivered virtual offerings and traditional multichannel subscriptions reversed a prolonged slide with a sequential increase of 319,000 or 0.4%, according to full market estimates from Kagan, a media research group within S&P Global Market Intelligence.

Traditional cable, telco and direct broadcast satellite providers staunched defections in the third quarter, benefitting from broadband bundles and the return of sports programming. The traditional services still collectively lost more than 1.6 million subs in the three months ended Sept. 30 but slowed the sequential decline to 2.1%, according to Kagan estimates.

The virtual services jumped nearly 2 million in the quarter, a 19% increase sequentially that overcame the traditional losses for the first time since we began tracking the category quarterly at the end of 2018.

Additional takeaways from Kagan's third quarter report:

• The single quarter of exceptional performance is insufficient evidence of an end to cord cutting for an industry combined total that is down 4.6% in the trailing 12 months or 4.3 million subscriptions.
• The combined penetration of traditional and virtual subscriptions, which accounts the total households in the U.S. taking a package of live, linear channels, posted rare gains to rebound to 67.4%.
• The percentage of households in the U.S. with a traditional multichannel subscription dropped to less than 58%.

About S&P Global Market Intelligence

At S&P Global Market Intelligence, we understand the importance of accurate, deep and insightful information. We integrate financial and industry data, research and news into tools that help track performance, generate alpha, identify investment ideas, perform valuations and assess credit risk. Investment professionals, government agencies, corporations and universities around the world use this essential intelligence to make business and financial decisions with conviction.

S&P Global Market Intelligence is a division of S&P Global (NYSE: SPGI), the world's foremost provider of credit ratings, benchmarks and analytics in the global capital and commodity markets, offering ESG solutions, deep data and insights on critical business factors. S&P Global has been providing essential intelligence that unlocks opportunity, fosters growth and accelerates progress for more than 160 years. For more information, visit www.spglobal.com/marketintelligence.

Media Contact
Amanda Oey
S&P Global Market Intelligence
Amanda.oey@spglobal.com
(212) 438-1904

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SOURCE S&P Global Market Intelligence

FAQ

What was the increase in U.S. households subscribing to live networks in Q3 2020 for SPGI?

U.S. households subscribing to live networks increased by 319,000 or 0.4% in Q3 2020.

How many subscriptions did virtual services gain in the third quarter of 2020 for SPGI?

Virtual services gained nearly 2 million subscriptions, reflecting a 19% sequential growth.

What was the rate of decline for traditional multichannel providers in Q3 2020 for SPGI?

Traditional providers lost over 1.6 million subscriptions, with the decline slowing to 2.1%.

What percentage of U.S. households had a traditional multichannel subscription as of Q3 2020 for SPGI?

The percentage of households with a traditional multichannel subscription dropped to less than 58%.

How did the combined penetration of subscriptions change in Q3 2020 for SPGI?

The combined penetration of traditional and virtual subscriptions increased to 67.4%.