Published in March 2017, this 68-page PDF and excel report combines two of last year’s reports: Digital TV North America Forecasts and the North America Pay TV Operator Forecasts in one convenient place. The report comes in four parts:
• Executive summary and regional forecasts, with handy comparison tables to reveal the best growth prospects;
• Regional forecasts summary from 2010 to 2022 by platform, by household penetration, by pay TV subscribers and by pay TV revenues;
The number of pay TV subs in North America [Canada and the US] will fall by 10 million from 112 million in the peak year of 2012 to 102 million in 2022. Although this marks a 9% decline, this does not indicate a massive cord-cutting problem.
However, the number of non-pay homes will climb from 20.69 million to 41.56 million over the same period [the number of total households will increase by 11 million. This includes non-TV households]. To put it another way, pay TV penetration will drop from the peak of 87.4% in 2013 to 75.2% by 2022.
The number of pay TV subscribers declined by 2 million in both 2015 and in 2016. However, the rate of decline will slow from now on, although the 2022 total will be 5 million lower than the end-2016 total, according to the North America Pay TV Forecasts report.
Simon Murray, Principal Analyst at Digital TV Research, explained: “Where are the lost subscribers in the decade to 2022 going? Some analog cable subscribers will give up paying for TV services rather than convert to an often more expensive digital platform.”
He continued: “Cord-cutting is also a factor. It has been somewhat exacerbated by the traditional pay TV operators starting their own OTT platforms: satellite TV platform Dish provides Sling TV and DirecTV Now has recently started. Other distractions include Hulu, HBO Now and, of course, Netflix and Amazon Prime Video.”
Cable has been losing subscribers since 2011. This is partly due to the fact that not all of the 18 million analog cable subscribers at end-2010 will convert to digital cable TV platforms – or any digital pay TV platform for that matter.
The free-to-air DTT household total will climb by 10 million between 2016 and 2022 to 31 million – presumably many of these sets will gather dust as these homes will have limited channel choice.
The digital cable TV total will remain flat at about 57 million subs from 2015. Satellite TV will also stay flat at about 36 million from 2015. However, IPTV will lose subscribers. Much of the IPTV loss is attributable to AT&T encouraging its U-Verse subscribers to its DirecTV satellite platform. In Canada, Bell is doing the opposite: encouraging its satellite TV subs to convert to its IPTV platform.
Pay TV revenues [subscriptions and PPV] in North America peaked in 2015 at $108.58 billion. Revenues will fall by 12.7% - or by $13.76 billion - to $94.82 billion in 2022. Cable revenues will decline by $12.13 billion - $2.19 billion less from analog cable and $9.94 billion lower for digital cable. Satellite TV will grow by $1.93 billion, but IPTV will fall by $3.55 billion – or by a massive 32.5%.