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Why it matters: While a merger may provide temporary relief, it likely won鈥檛 solve the fundamental challenges facing satellite TV providers as cord-cutting accelerates. Unlike cable companies, satellite providers can鈥檛 easily diversify into other services like internet access. Listen to the full episodes (Part One, Part Two). This was originally featured in the 蘑菇AV Daily newsletter.

Pay TV prices have increased, but cord-cutting has been so drastic that traditional pay TV subscription revenues continue to shrink between 6% and 7% per year. Among pay TV providers, satellite has been hit hardest. The declines in pay TV aren鈥檛 equally spread out. In 2024, subscription revenues will shrink by 4.1% for cable, 6.4% for telco, and 11.5% for satellite, per our estimates.

Comcast Q3 performance fueled by streaming and live sports: Olympics and Peacock growth attract high-value audiences for advertisers.

With the steady drumbeat of cord-cutting looming over the industry, streaming鈥攁nd programmatic鈥攚ill play a bigger role than ever in this year鈥檚 negotiations. Advertisers will use conversations started last year as a springboard to incorporate more programmatic spending into their upfront deals. By the end of 2024, more than 4 in 5 new CTV ad dollars will transact programmatically, per our forecast.

Cord-cutter households will surpass 4 million in 2023. Defined as former traditional pay TV subscribers who canceled in favor of streaming, the number of cord-cutters in Canada will be 8.6 million this year. That鈥檚 up from 5.1 million five years ago. Cord-nevers will reach 4.5 million this year.

FAST trend grows globally: New channels from Free Live Sports, CBC, and Pluto TV showcase demand for free, ad-supported streaming options.

In previous years, TV networks recouped cord-cutting losses by raising ad prices. Even during low inflation years, it wasn鈥檛 unusual for TV CPMs to jump double digits YoY. Cord-cutting continued raging but price increases couldn鈥檛 prop up viewership losses during negotiations. The scatter market could pick up.

There鈥檚 no turning back the tide of cord cutting. The traditional cable, satellite, and telco pay TV bundle continues to lose ground to streamers, and the trend is irreversible. The resolution of the Disney-Spectrum dispute was only a temporary respite. The existential questions that the carriage scuffle brought up are still latent.

Cord-cutting will limit the strike鈥檚 viewership impact when compared with previous TV labor stoppages. However, the strike鈥檚 stoppage of US scripted productions has ramifications. Streaming services are less affected than TV networks. Services like Netflix produce shows many months before they air, so a short strike will be unnoticeable.

Without the potential for bundling that a service like Hulu has, Roku will have to do a lot to get cord-cutting consumers to jump aboard.

Digital pay TV services have slowed cord-cutting somewhat. Digital pay TV services have grown from 700,000 US households in 2015鈥攚hen Sling TV was launched鈥攖o 17.8 million households in 2024. Digital pay TV will account for one-fourth of total US pay TV subscribers in 2024. These services have attracted cord-cutters as well as cord-nevers.

Still, cord-cutting and digital attribution issues certainly make it easier to justify cuts.

CTV time is also racing ahead of its analog counterpart as cord-cutting rages on. These trends aren鈥檛 new, but our forecasts show recent or imminent tipping points that leave no doubt as to where things are headed. The pivot to profitability has implications.

As cord-cutting continues and CTV adoption soars, the powerful performance marketing capabilities of this growing channel will play a greater and greater role in shaping the future of TV advertising.

Why it matters: Venu Sports represents a significant shift in the sports streaming landscape, aiming to capture the attention of cord-cutters who have moved away from traditional pay TV. With a comprehensive package of live sports, the service targets a market segment willing to pay for sports-centric content at a lower cost.

鈥淐辞谤诲-肠耻迟迟颈苍驳 is happening at a tremendous rate,鈥� he added, amounting to 233.9 million people鈥攐r 68.4% of the population. Digital pay TV, however, which includes services such as YouTube TV and Sling TV, is slowing down the trend, but only slightly.

The CTV boom: Record cord-cutting and increased time spent has made CTV one of the strongest ad spending sectors in 2023. But while viewership has made gains, ad spending has shifted over from TV more slowly, giving video competitors time to race to win market share. US CTV spending will total $25.09 billion compared with TV鈥檚 $61.31 billion.

The cord-cutting trend continues. By the end of 2027, US households without any form of pay TV will outnumber those with some form of pay TV. In this comparison, pay TV includes both traditional pay TV and digitally delivered services known in industry parlance as virtual multichannel video programming distributors (vMVPDs). The revolution will be connected.

Cord-cutters are trying to get away from bundling; that is, paying more for programming they don鈥檛 care for. In many ways, WBD is trying to do just that: (eventually) charging users more for a secondary library of content they may not consume鈥攚hile simultaneously taking some content off the platform and licensing it to the likes of Roku and Tubi.

Increased cord-cutting has been a death knell for regional sports. Diamond Sports Group, a Sinclair-owned portfolio of regional sports networks, declared bankruptcy in March after cord-cutting cut into its viewership and its streaming offering Bally+ failed to take off.

Many cord-cutters want an experience like traditional TV, with continuous content and ads serving as background noise during tasks like ironing. This "lean away TV" approach lets viewers look away without missing key plot points. Our take: As Google continues to expand its CTV presence, it faces competition from players like Amazon and Roku.

Football fans will have cheaper access to the Ticket if they are YouTube TV subscribers, and this will draw in as many as 2 million cord-cutting sports viewers. vMVPDs remain the smallest OTT players overall, however, thanks to their high cost. Note that these projections are not akin to the various companies鈥� self-reported subscriber or user numbers.

Cord-cutting hit a historic landmark, and viewership migrated over to streaming services, making the industrywide issues of signal loss and decreased spending especially painful. TV advertising has entered its sunset era.

Free from outdated broadcasting constraints, streaming apps are absorbing billions in ad budgets, targeting cord-cutting audiences and premium content environments. However, this explosive growth brings familiar challenges. Rampant fraud and opaque ad placements are beginning to encroach on what was once considered a safe haven from controversies plaguing social media feeds and user-uploaded content.

Rather than getting users who have become accustomed to a decade of ad-free streaming to jump on the ad-supported train by axing cheap subscription options and cracking down on cord-cutters, Amazon is simply making ad-supported streaming the default for all Prime members. To avoid ads, users will have to pay an extra $2.99 monthly.