Still Hate Your Cable Company? 292,000 Defections Show You're Not Alone
With the exception of DirecTV's (DTV) -- which gained 67,000 net subscribers during the quarter -- the key players lost more video customers than they signed up.
It's not pretty, but let's look at the net change in U.S. residential video subscribers for the third quarter.
- DirecTV: +67,000
- Cablevision (CVC): -10,000
- Dish Network (DISH): -19,000
- Charter Communications (CHTR): -73,000
- Comcast (CMCSA): -117,000
- Time Warner Cable (TWC): -140,000
It's grim. Add up all six players and the cable and satellite TV industries closed out the period with 292,000 fewer customers than they had just three months earlier.
Where Did Everyone Go?
AT&T (T) and Verizon (VZ) have been gaining ground with their slightly more economical U-verse and FiOS services, respectively, but that doesn't explain the entire shortfall. Folks are either genuinely fed up with their TV bills or they just can't pay up.
Life After the Cables Are Cut
There are plenty of solutions for those ditching their pay TV plans. HD antennas are a cheap way to receive over-the-air local channels, and are growing in popularity. Beyond that, homes with Internet and WiFi can take advantage of a growing number of video services.
Cable and satellite television providers know this. They have been trying to milk more value out of their subscriptions by offering broader arrays on-demand content. The "TV Everywhere" movement -- which allows cable customers to stream the channels they are already paying for through mobile apps at no additional cost -- was initiated by Comcast and Time Warner Cable.
However, customers are getting antsy. They don't appreciate having to pay a growing flat fee for one-size-fits-all baskets of programming that include more channels that they'll never watch than channels they will.
When the pay-TV industry suffered its first quarter of net defections two years ago, some suggested that it was simply a matter of the soft economy. Now that the economy is clawing its way back, it's clear that the industry has a bigger retention problem on its hands.
Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article.