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Will U.S. Pay-TV Industry Continue Facing Distressing Times?
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Strong presence of online video streaming providers is posing significant threat to the existing pay-TV business model. Video offering, which represented the core business function of cable TV operators, seems to be fast slipping out of their hands.
Per a recent report by TDG Research, the traditional pay-TV service, which currently reaches 81% of U.S. households, is likely to shrink to 60% by 2030. At the same time, Internet TV streaming service is expected to gain 14% of U.S. household subscription from a mere 4% today. Similarly, U.S. household subscription for live multi-channel service will come down from the current level of 85% to 79% in 2030.
The growing deployment of 4G LTE mobile network and significant adoption of portable mobile devices are the primary reasons propelling the popularity of Internet TV streaming. The Millennials have a strong appetite for new technologies, as they are no longer interested to incur huge bill for a fat pay-TV bundle. Skinny TV bundle in cost-effective manner is the next-generation favourite. (Read: Will Internet TV Streaming Replace Legacy Pay-TV in 2018?)
Major pay-TV operators, such as AT&T Inc. (T - Free Report) , DISH Network Corp. and Sony Corp. have already launched their Internet TV streaming services. Apart from these three companies, YouTube TV of Alphabet Inc. (GOOGL - Free Report) and Hulu Live TV also offer Internet TV streaming facilities. Each of the above-mentioned stocks carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In June 2017, research firm SNL Kagan predicted that the U.S. pay-TV industry (comprising of cable, satellite and IPTV operators) will lose approximately 10.8 million customers by 2021. Total pay-TV subscribers will be around 82.3 million at that time, which will be 20% less than the industry’s historical high level.
It is to be noted that, exponential growth of mobile data usage supported by flourishing high-end smartphone and tablet devices has changed the entire dynamics of the traditional pay-TV industry. The Internet TV streaming service, launched by leading pay-TV operators in the United States, is yet to counter the onslaught of the low-cost online video streaming services. It remains to be seen how major pay-TV operators can survive the competition.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Will U.S. Pay-TV Industry Continue Facing Distressing Times?
Strong presence of online video streaming providers is posing significant threat to the existing pay-TV business model. Video offering, which represented the core business function of cable TV operators, seems to be fast slipping out of their hands.
Per a recent report by TDG Research, the traditional pay-TV service, which currently reaches 81% of U.S. households, is likely to shrink to 60% by 2030. At the same time, Internet TV streaming service is expected to gain 14% of U.S. household subscription from a mere 4% today. Similarly, U.S. household subscription for live multi-channel service will come down from the current level of 85% to 79% in 2030.
The growing deployment of 4G LTE mobile network and significant adoption of portable mobile devices are the primary reasons propelling the popularity of Internet TV streaming. The Millennials have a strong appetite for new technologies, as they are no longer interested to incur huge bill for a fat pay-TV bundle. Skinny TV bundle in cost-effective manner is the next-generation favourite. (Read: Will Internet TV Streaming Replace Legacy Pay-TV in 2018?)
Major pay-TV operators, such as AT&T Inc. (T - Free Report) , DISH Network Corp. and Sony Corp. have already launched their Internet TV streaming services. Apart from these three companies, YouTube TV of Alphabet Inc. (GOOGL - Free Report) and Hulu Live TV also offer Internet TV streaming facilities. Each of the above-mentioned stocks carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In June 2017, research firm SNL Kagan predicted that the U.S. pay-TV industry (comprising of cable, satellite and IPTV operators) will lose approximately 10.8 million customers by 2021. Total pay-TV subscribers will be around 82.3 million at that time, which will be 20% less than the industry’s historical high level.
It is to be noted that, exponential growth of mobile data usage supported by flourishing high-end smartphone and tablet devices has changed the entire dynamics of the traditional pay-TV industry. The Internet TV streaming service, launched by leading pay-TV operators in the United States, is yet to counter the onslaught of the low-cost online video streaming services. It remains to be seen how major pay-TV operators can survive the competition.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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