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Netflix gains more US subscribers than cable TV

News, 19 June 2017
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SAN JOSE, CA: Netflix, the popular video streaming service, now has more subscribers in the US than the largest American cable TV providers combined, according to a recent study.

The research, conducted by the Leichtman Research Group and first reported by the Daily Mail, found that the top six cable companies in the US – accounting for about 95% of the market – had 48.6m subscribers in the first quarter of 2017.

Netflix announced in April that it had 50.9m paying subscribers over the same period, so comparison with the Leichtman analysis suggests the company has reached a significant milestone.

Leichtman Research also estimated that the top US cable companies lost 115,000 subscribers in Q1 2017, whereas Netflix reported earlier this year that it had added another 1.4m users over the quarter.

According to the Daily Mail, Netflix has also witnessed explosive growth over the past five years as it more than doubled its US subscriber base from 23.41m in the first quarter of 2012 to its current total of 50.9m.

By comparison, cable TV providers had 52.6m subscribers in Q1 2012, or a loss of around four million paying customers over the past five years.

However, while the research appears to suggest a switch from one channel to another, it should be noted that many consumers subscribe to both, and a recent study from Zenith confirmed that traditional TV remains dominant across all media.

The Leichtman research also pointed to the growing popularity of internet-delivered services, such as Sling TV and DirecTV Now, which added 350,000 subscribers in the first quarter of 2017.

Commenting on the findings, Bruce Leichtman, President and Principal Analyst at Leichtman Research Group, said: "The pay-TV market lost about 410,000 subscribers in the first quarter of 2017. This marked the first time that the industry has ever had net subscriber losses in the first quarter of a year.

"The decline in subscribers should not be interpreted as solely driven by a sudden increase in consumers disconnecting services. The net losses are also a function of a decrease in new connects, partially due to some providers less aggressively pursuing lower value customers than in the past."

Data sourced from Leichtman Research Group, Daily Mail; additional content by WARC staff

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