For the pay-TV industry, 2013 was a down year. But pay-TV providers can look forward to growth in the next five years.
Subscriptions dropped less than 1% in 2013 — the first decline for providers. But homes that subscribe to pay TV are expected to grow annually from 2014 to 2019, increasing from about 101 million to 103.2 million, according to a new report out today from Strategy Analytics.
Better pay-TV services that incorporate Net TV content providers such as Netflix and deliver improved on-the-go content viewing will help drive increased subscriptions, the research firm says. And more homes will opt for pay TV from telecom providers such as AT&T and Verizon.
That explosion of choice — in TV delivery and programming — puts the onus on viewers, says Joel Espelien of The Diffusion Group. "You have to be so much more of a sophisticated consumer," he says, "because these services are part-technology, part-user interface and part-original content."
But even double-digit increases in sophisticated Internet-based pay-TV services cannot prevent the pay-TV household penetration rate from falling slightly — from about 81% in 2013 to about 78% in 2019. Contributing to the decline: cord-cutting homes and new homes that don't get pay TV.