Jeremy Hobson: DirecTV is reporting its first-ever quarterly loss of customers. And it appears those customers are not flocking to the competition — Time Warner Cable also lost subscribers for the tenth quarter in a row.
Marketplace’s Amy Scott reports on the changing business of pay-TV.
Amy Scott: More than 400,000 households have dropped their cable or satellite TV service this year.
Paul Palumbo is an analyst with AccuStream iMedia Research. He says part of it is a generational shift. He says more people age 18 to 35 have game boxes connected to their TVs. They’re using them to watch shows through online services like Netflix and Hulu.
Paul Palumbo: What you see here is reference-driven programming. They’re not going to subscribe to everything and then watch what they choose to watch. They’re going to use their points of access that they know well and choose the programming that they like.
The second quarter is typically the slowest time for the business as people move and college kids drop their service for the summer. DirecTV also lost customers as it tightened its credit standards for subscribers.
At the same time, cable companies profited from demand for streaming video. TimeWarner and Comcast both reported higher earnings this week, thanks to sales of high-speed Internet service.
I’m Amy Scott for Marketplace.
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