The number of homes subscribing to traditional television services in the United States continues to decline and are forecast to reach parity with the number of households that do not subscribe to television in 2024. That is still over 180 million potential viewers. Assuming the decline continues, is there a lower limit?
In 2015 there were just under 99 million households in the United States subscribing to a traditional television service. The system has been steadily leaking subscribers since then, and the numbers for online multichannel video services are not compensating.
In 2020 the number of homes subscribing either to a traditional television service or an online multichannel service had fallen to fewer than 88 million. That is still 88 million households, or around 220 million viewers.
The analyst firm MoffettNathanson forecasts that the pay television universe will continue to decline at between 4% and 5% a year and will fall to 73 million by 2024, which is over 180 million individuals. The number homes in the United States subscribing to a television service will then be around the same number as the number of homes that do not.
That is a significant change. It is still worth noting that half of all homes in the United States will be subscribing to television services.
The firm does not project beyond that point to suggest whether the proportion of homes subscribing to television services will continue to fall further. It does suggest that the floor may be defined by the number of homes that are prepared to pay for live sports and want to watch news. Analyst Craig Moffett described that group as “the bedrock floor of the Pay TV world”.
Based on survey data, the firm estimates that there are around 58 million households subscribing to television that watch sport, and that of those around 5 million only watch live sport. It concludes that could leave about 53 million homes that are regular television news and sports viewers, which it suggests could be the core base for television subscribers.
That implies that of around 84 million homes that subscribe to television in the United States at the end of 2021, the number could fall by a further 30 million. It could fall further than that if more sports move to a direct-to-consumer online video model.
“While we have long believed that live sports and news are the glue holding the Pay TV bundle together, we still question the strength of that adhesion,” Craig Moffett warns.
To which we might add that while news and sport are important, there is more to television than that. While online video services can cater for specific genres, such as drama and documentaries, there is still an apparent need for entertainment through shared experiences, which broadcasting has so far served.
At the end of 2021, there are still around 220 million people in the United States living in homes that pay for a television service, either through a traditional cable or satellite system, through telco television, or an online multichannel service.