Here’s another warning to MVPDs from a global market intelligence organization regarding the continued wave of “cord cutting” inflicting harm on the cable and DBS service provider’s growth prospects in the near-term.
“Video cord cutting is expected to strip nearly $33.6 billion in annual revenue from traditional U.S. multichannel services” by the end of 2025.
That’s according to a report released this week by Kagan.
The media research group within the TMT offering of S&P Global Market Intelligence provides a detailed five-year outlook at multichannel video trends in the U.S.
They’re hardly charming.
“The impact of the migration of consumers from big subscription services,” Kagan notes, “is charting a source for sales to dip from $91.1 billion in 2021 to $64.7 billion in 2025.”
Kagan’s forecast examines cable, telecommunications multichannel operations and direct broadcast satellite brands Dish and DirecTV.
Prepared by Kagan’s Ian Olgeirson and Tony Lenoir, the researchers believe that changing viewing patterns, only slightly moderated by rising average revenue per unit, are forecast to depress sales (excluding advertising) by 45% from the estimated 2016 annual peak of more than $116.9 billion.
While all three major platforms are feeling the impact from the shift, the magnitude of the losses are expected to hit more acutely for Dish and DirecTV and for telco revenue subtotals amid what they perceive are “waning commitments by major players” and relative stability from the large cable providers, such as Comcast Xfinity, Charter Spectrum and Cox.
