Pay-TV companies are facing subscriber losses
Media companies like Dish Network (DISH) and Comcast (CMCSA) in the pay-TV business are suffering from subscriber losses. While Dish Network’s (DISH) pay-TV subscriber losses continue to rise, Comcast also recorded pay-TV subscriber losses in fiscal 2Q17.
While Dish recorded subscriber losses of 196,000 in fiscal 2Q17, Comcast recorded subscriber losses of 34,000 subscribers. Dish expects the decline in the pay TV business to continue. The company has cited rising competition from video streaming services as one reason for the decline in subscribers.
However, Dish is trying to staunch these subscriber losses by targeting viewers in rural areas of the United States (SPY) who have fewer viewing options. Dish is also targeting subscribers who can subscribe long-term.
Comcast’s pay-TV business
Comcast linked its subscriber losses in fiscal 2Q17 to seasonality. Barring subscriber losses in fiscal 2Q17, however, Comcast’s video business continues to do exceedingly well. A major reason for Comcast’s success is its X1 set-top box. Comcast views the X1 set-top box as a content aggregator and expects to integrate more services like Netflix (NFLX) and Alphabet’s (GOOG) YouTube on X1.
The company expects X1 to record penetration in the low 60.0% range by the end of fiscal 2017. Another factor responsible for Comcast’s successful video business was its market segmentation strategy.
As part of this strategy, Comcast is offering different triple-play (high-speed Internet, voice, and video) products that cater to different customer needs.