Study Predicts Long Term Subscriber Loss for Legacy MVPDs
Here is some bad news for legacy multichannel video programming distributors (MVPDs). According to a new study, we can expect to see continued significant subscriber loss in this space over the course of the next decade or so.
Right now legacy TV penetration is hovering at around 81 percent of U.S. households. By 2030, this should fall to about 60 percent of U.S. households, which is an estimated loss of 26 percent for the forecasted period.
At the same time, virtual pay TV services like DirectTV and Sling TV will grow from about 4 percent of U.S. households to 14 percent.
What’s more, live multichannel pay TV services will decrease from 85 percent of U.S. households in 2017 to 79 percent in 2030. And by 2030, about 30 million U.S. households will have no MVPD service of any kind.
Of course, these are just predictions. There is no telling what the future will bring especially with the current pace of technology, and the ever-changing needs of consumers. Will consumers even still be using traditional screens in 2030? It’s debatable. Just think about how much the industry has changed in the last 5 to 10 years. By 2030, we could have a completely different system in place and so it’s very difficult to predict how the industry will change over the long term.
Still, subscriber loss is not a problem that should be ignored. In order to survive, MVPDs need to be looking for ways to combat subscriber loss.
You may not be able to keep all customers from pulling the plug, but there are some things you can do to stop the financial bleeding and even start profiting again.
Here are some suggestions:
Offer skinny bundles: It may be time to re-think your current content distribution model, if you are still primarily offering packages with 100 channels or more. Now, skinny bundles are all the rage. It’s a way of delivering only channels that customers want to watch. By offering skinny bundles, you could prevent some unhappy customers from leaving.
Slash prices: Over-the-top services are not as cheap as they used to be. When companies like Netflix raise their prices, it’s a great time to consider lowering yours to try and re-gain people who had previously cut the cord.
Explore smart home solutions: MVPDs offering broadband services should consider branching out into the smart home solutions market—capitalizing on smart home security, utility and entertainment services.
By taking these points into consideration, you could find new ways of generating profits. So, what are you doing to prepare for the future?