Total TV subscriber growth slows to 1%, will be negative this year, analyst says

Total TV subscriber growth for cable, IPTV, and satellite TV services in Canada slowed to one per cent in the 2011-2012 broadcast year, reaching a total of 11.5 million subscribers, according to new data released by the CRTC. Annual TV subscriber growth in 2012 has fallen by more than half from previous years, when annual growth was more than two per cent, according to the data. The CRTC released data Tuesday showing that, from 2011 to 2012, TV subscribers to cable, IPTV or satellite TV services rose by 117,450 in Canada, representing growth of 1.03 per cent, compared to total additions of 237,189 from 2010 to 2011 and growth of 2.13 per cent. Subscriber growth also slowed significantly from the end of 2010, when TV subscriber additions rose 2.77 per cent, or by 238,648, from the end of 2009, according to CRTC data compiled by The Wire Report. TV subscriber growth from 2008 to 2009 was 2.25 per cent, or 238,648 subcriber additions. The downward trend in TV subscriber growth indicates negative growth, or an overall industry subscriber loss, in 2013, Duncan Stewart, director of technology, media and telecom at Deloitte Canada, said in an interview. He said the rate of people moving from one home to another, the health of the economy, and cord cutting, are factors influencing changes in the number of new TV subscriptions added each year. When more young people move out of their parents' homes, he said, overall TV subscriptions tend to rise. “One of the things that happens is that, during economically good times, people move out faster,” Stewart said. “Whereas, when you don’t have a job, people don’t move out of their parents’ homes.” Stewart said cord cutting, or the rate at which people are cancelling TV to rely on Internet services, remains a factor, though “historically, cable or pay TV numbers in North America have gone up or down in line with the economy.” He said Deloitte predicts subscription growth in North America to be negative in 2013 and that, in Canada, “the rate will drop further or go barely negative.” Media Technology Monitor (MTM), a joint-research project between CBC/Radio-Canada and BBM Analytics, said in a survey released in March that the number of people in Canada who do not have a TV service has doubled over the past three years. The survey of 8,011 Canadians across Canada found that, nationally, the number of people without a television subscription or the use of free, over-the-air TV, has risen from 4 per cent in 2010 to 7 per cent in 2011 and now to 8 per cent in 2012. Most TV subscriber losses are coming from cable and satellite TV services as higher-capacity, fibre-based IPTV services contintue to attract new customers. In total, combined cable, telco and satellite TV revenues for the broadcast year ended Aug. 31, 2012 rose by 4.2 per cent to reach $14.1 billion, up from $13.5 billion the previous year, the CRTC said in the data released Tuesday. The commission said it included fibre-based IPTV providers like Bell Aliant Inc. and Telus Corp. in its calculations of total “cable” industry numbers. Cable companies increased their hiring in 2012, raising employment from 25,291 to 26,502 people, the CRTC said. “As a result, total employee salaries jumped by 9.9%, from $2 billion to $2.2 billion,” the CRTC said. Revenues for Canada’s wireline TV, Internet and telephone service companies, including cablecos and telcos, rose by 5.7 per cent in 2012 to $11.6 billion, up from $11 billion the previous year, the CRTC said. The commission said total profits before interest and taxes remained “virtually the same” for those companies in 2012, at $2.6 billion. The CRTC said the number of people subscribing to basic television via satellite fell by 1.8 per cent, or 51,746 subscribers, in 2012, reaching 2.8 million. After years of growth, the report said, revenues for satellite companies fell by two per cent, from $2.55 billion in 2011 to $2.5 billion in 2012. “These companies employed 2,098 people and paid $188.9 million in salaries, both of which were lower than the previous year,” the CRTC said. The CRTC data showed that in 2011, satellite companies employed 2,478 people and paid $222.1 million in salaries. —With reporting by Danika Grenier at dgrenier@thewirereport.ca and reporting and editing by Simon Doyle at sdoyle@thewirereport.ca

Total TV subscriber growth slows to 1%, will be negative this year, analyst says

Broadcast | April 9, 2013

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