Omdia has removed of some TV, Broadband, and Voice customers from historical traditional US Pay TV metrics to more accurately reflect the residential market. The revised metrics are now aligned with the existing methodology standards for the global Omdia pay TV coverage.
The net result of the adjustment was the removal of 2.1 million TV subscribers, 371,000 cable broadband, an 279,000 cable voice in Q2 2020.
The large reduction in TV subscribers is thanks to the removal of Comcast, DirecTV and Dish Network TV subscribers primarily. Combined, the companies contributed 1.75 million of the 2.1 million change in TV subscribers in Q2 2020.
Removing business subscribers from Omdia’s methodology has had a profound impact on our assessment of the future of the TV market. Previously Omdia had forecast that in 2024 there would be around 63 million pay TV subscribers. That outlook has been negatively revised to 59.9 million.
Before the adjustment, traditional pay TV was expected to cross the 60 million barrier around 2026 or 2027. This is significant because the overall pool of customers who have the options to take subscriptions to premium tiers and do transactional on-demand (within the walled garden) has shrunk by about 5%.
Revised subscriber metrics will not impact license fee reporting and forecast. Business TV customers are charged license fees as well, so in aggregate channel groups will earn the same total fee revenue. To that end Omdia expects that total license fees will continue to grow in the high single digits through 2024. Monthly ARPUs are expected to rise as well, the tried and true compensation mechanism for fewer subscribers.