Power

Cord cutting in 2020: Pay TV industry lost 5.5 million subscribers

Subscriber defections slowed toward the end of the year, but there's no end to cord cutting in sight.

Cord cutting in 2020: Pay TV industry lost 5.5 million subscribers

The pay TV industry is undergoing a bit of a power shift.

Photo: Nicolas J Leclercq/Unsplash

The five biggest pay TV providers lost a combined 5.5 million subscribers in 2020, narrowly staying below the 5.8 million subscribers the companies collectively lost in 2019. Subscriber losses slowed a bit toward the end of the year, but pandemic-related cutbacks still hit the industry hard — and may have led to hundreds of thousands additional cancellations if not for industry-wide billing relief efforts.

The industry is undergoing a bit of a power shift, with pay TV subscribers switching from traditional operators like Comcast and AT&T to tech companies like Google and Hulu and their respective pay TV services. However, a closer look at pay TV trends suggests that these gains may be temporary, as so-called skinny bundles fall out of favor with consumers once operators are forced to increase their price tags to make up for ever-increasing network licensing costs.

The holiday quarter saw significant improvements for AT&T, which got hit hard in late 2019 by consumers ditching its AT&T TV Now online service following significant price increases. Losses notably increased at Comcast, which lost 227,000 subscribers during the holiday quarter, compared to 133,000 during the same quarter a year before.

Looking at the entirety of 2020, AT&T was able to narrow its losses; the telco lost nearly 3.3 million pay TV subscribers in 2020, compared to more than 4 million in 2019. Comcast saw its losses increase from 671,000 in 2019 to nearly 1.3 million. Only Charter was able to actually grow its subscriber base, moving from a loss of nearly 500,000 subscribers in 2019 to a narrow gain of 19,000.

There's been some evidence for pay TV customers transitioning to nontraditional service providers including YouTube TV and Hulu's online pay TV service. Disney disclosed as part of its latest earnings results that Hulu's TV service ended 2020 with 4 million subscribers, compared to 3.2 million at the end of 2019.

However, these gains may be short-lived, if similar efforts run by major pay TV providers are any indication. AT&T effectively discontinued AT&T TV Now in January after losing millions of the service's subscribers when it phased out introductory pricing and raised bundle prices to make up for increased carriage fees. Dish's Sling TV service lost 118,000 subscribers in 2020 even before announcing a price increase in January.

Even Hulu's pay TV service doesn't look as rock-solid once you zoom in a bit: The Disney subsidiary lost around 100,000 pay TV between the end of September and the end of December; Hulu increased the price of its live TV bundle by $10 per month in late December, making it likely that we will see further subscriber defections during the current quarter.

Protocol | Fintech

A lawsuit tests who controls the stock market

Citadel Securities seeks to block IEX's product that limits high-frequency trading advantages.

Kenneth Griffin is the founder and chief executive officer of Citadel LLC, which argued during Monday's hearing that IEX's D-Limit order type shouldn't have been approved by the SEC.

Photo: Patrick T. Fallon/Bloomberg via Getty Images

Market maker Citadel Securities, stock exchange IEX and the Securities and Exchange Commission each gave oral arguments Monday in a legal case that could have large implications for financial markets.

Last October, Citadel Securities sued the SEC, seeking to reverse the SEC's previous decision last August to approve IEX's D-Limit order type, arguing that this order type would hurt the overall market. The case was argued before the U.S. Court of Appeals Monday.

Keep Reading Show less
Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. Before that, he worked as a staff writer at Forbes, covering social media and venture capital, and also edited the Midas List of top tech investors. He has also worked at newspapers covering crime, courts, health and other topics. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

If you've ever tried to pick up a new fitness routine like running, chances are you may have fallen into the "motivation vs. habit" trap once or twice. You go for a run when the sun is shining, only to quickly fall off the wagon when the weather turns sour.

Similarly, for many businesses, 2020 acted as the storm cloud that disrupted their plans for innovation. With leaders busy grappling with the pandemic, innovation frequently got pushed to the backburner. In fact, according to McKinsey, the majority of organizations shifted their focus mainly to maintaining business continuity throughout the pandemic.

Keep Reading Show less
Gaurav Kataria
Group Product Manager, Trello at Atlassian

Everything you need to know about the Allbirds IPO

Allbirds wants to become an iconic global brand for shoes and everything else.

Photo: Spencer Platt/Getty Images

The humble venture capitalist puts on her Allbirds one shoe at a time, just like everybody else (or at least everyone else in Palo Alto).

Since its founding in 2015, Allbirds has become an essential component of the tech bro uniform, alongside such staples as the embroidered Patagonia quarter-zip, Lululemon ABC pants, the Zuck-inspired black T-shirt and a Y Combinator-branded Hydro Flask.

Keep Reading Show less
Hirsh Chitkara
Hirsh Chitkara (@ChitkaraHirsh) is a researcher at Protocol, based out of New York City. Before joining Protocol, he worked for Business Insider Intelligence, where he wrote about Big Tech, telecoms, workplace privacy, smart cities, and geopolitics. He also worked on the Strategy & Analytics team at the Cleveland Indians.
Protocol | Policy

It’s Frances Haugen’s world. We’re all just living in it.

With the release of the Facebook Papers, Haugen holds Facebook's future in her hands.

Haugen's decision to open the trove of documents up to outlets beyond the Journal has sparked a feeding frenzy.

Photo: Frances Haugen

Facebook knows a thing or two about optimizing content for outrage. As it turns out, so does Frances Haugen.

Or at least, the heavyweight team of media and political operatives helping manage the rollout of her massive trove of internal documents seems to have learned the lesson well. Because the document dump known as the Facebook Papers, published the same day as Facebook's earnings call with investors and the same week as the conference where it plans to lay out its future as a metaverse company, wasn't just designed for mass awareness.

Keep Reading Show less
Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.

Here are all the Facebook Papers stories

They paint a picture of Facebook that's very different from what Mark Zuckerberg likes to say.

Image: Getty Images, Protocol

Monday morning's news drop was a doozy. There was story after story about the goings-on inside Facebook, thanks to thousands of leaked documents from Frances Haugen, the whistleblower who wants the information within those files to spread far and wide. Haugen is also set to speak in front of the British Parliament on Monday, continuing the story that is becoming known as The Facebook Papers.

Keep Reading Show less
David Pierce

David Pierce ( @pierce) is Protocol's editorial director. Prior to joining Protocol, he was a columnist at The Wall Street Journal, a senior writer with Wired, and deputy editor at The Verge. He owns all the phones.

Latest Stories