The pace of cancellations among U.S. pay TV subscribers quickened in the second quarter as more online viewing options hit the market, Moffett Nathanson analysts said on Friday at the end of a dismal week for media stocks.
Analysts Craig Moffett and Michael Nathanson estimated the pay TV industry lost 566,000 subscriptions from April through June. The sector is now declining at an annual rate of 0.7 percent, they said, compared with 0.1 percent a year ago.
"That may not seem like a mass exodus, but it is a big change in a short period of time," the analysts wrote in a note to clients. "And the rate of decline is still accelerating."
Media stocks plunged this week on concerns about "cord cutting," or dropping of cable or satellite TV subscriptions, fueled by Walt Disney's admission that its sports juggernaut ESPN had lost a "modest" number of customers.
The second quarter saw the debut of new online options that do not require a cable subscription, including Time Warner's HBO Now and Sony's PlayStation Vue. They join other Internet-delivered services such as Netflix Inc and Dish Network's Sling TV.