According to a new report released by the investment banking firm, UBS, revenue created by streaming services in Q2 2017 has finally started to catch up with the losses of more traditional television services. That’s not to say that anything has necessarily stopped the bleeding for traditional providers since paid television subscriptions are still down and still falling rapidly as people move away from the hassle of cables and antennas. The losses are being offset in the digital subscription portion of the market – particularly for providers like Netflix or Hulu. The numbers do show a glimmer of hope for media in general, however, since the numbers appear to show a stabilizing overall market.
The number of subscriptions lost across both platforms was down by only 313,000 in Q2 2017, as compared to a drop of 593,000 the year before. However, it is worth noting that most of the losses for the year so far are in the traditional sector, with AT&T losing 351,000 in Q1. In fact, Q1 2017 saw huge losses across the board for subscription services from television distributors – rounding out at about 709,000 total subscriptions lost. Reporting from those providers has shown that revenues are up for the companies involved, despite the drop in subscriptions. Scripps Interactive, NBC Universal, Discovery, and Time Warner even managed to beat out projections the companies had previously made – which could be attributed to lower operating costs, more efficient pricing and promotions, and improved service quality. That being said, many of the companies involved in the industry also missed projections. AMC and Viacom, for example, fell short by 3 percent and 2.2 percent.
Losses in the subscription arena for more traditional service providers aren’t likely to stop in the future either. That can be shown in the fact that year-over-year, according to UBS, traditional providers’ losses added up to around 283,000 worse, while virtual subscriptions were up by 554,000. Adding to those woes, new services are being created by several big tech companies around the world – including Google. That could lead to a ramp up competition and innovation in that space, leaving traditional providers with few options but to adapt. Unfortunately for those providers, that assessment is backed by a UBS projection that Q3 2017 will see more of the same. In the meantime, the full report can be accessed via the source link below.
