PAY-TV SUB HOUSEHOLDS DROP BELOW 80%



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Thursday, September 28, 2017

PAY-TV SUB HOUSEHOLDS DROP BELOW 80%

CABLE NET PENETRATION ALSO DOWN New consumer research from Leichtman Research Group (LRG) finds that only 79% of TV households nationwide subscribe to some form of pay-TV service. The percentage of TV households that subscribe to a pay-TV service is down from 84% in 2014, 88% in 2010, and 81% in 2004.

A separate report from analyst Brian Wieser at Pivotal Research Group finds yet another monthly decline in household penetration by cable networks. While the October numbers from Nielsen indicate that the total number of TV households rose by 1% from a month earlier, the median cable network lost 3.1% of their subscribers--continuing a trend that has been reported here for many months.

LRG president Bruce Leichtman noted that the 79% figure for cable/satellite/telco video service is down from its peak at the start of the decade and marks the first time since the early 2000s that fewer than four-in-five TV households subscribe to a traditional MVPD. "The decline in pay-TV penetration is not solely a function of recent disconnects. Among those that do not currently get a pay-TV service, about one-third subscribed in the past three years, onethird subscribed over three years ago, and one-third never subscribed," Leichtman explained.

Among TV households that do not currently subscribe to a pay-TV service, about two-thirds were former pay-TV subscribers, while one-third never had pay-TV. Overall, about 7% of TV households subscribed to a pay-TV service in the past three years, 7% last subscribed to pay-TV over three years ago, and about 7% never subscribed to a pay-TV service.

Not having a pay-TV subscription is not driven exclusively by income. In fact, only 16% of households with an annual income under $50,000 do not subscribe to an MVPD. For households with incomes greater than $50,000 the nonsubscriber figure is 29%.

Not everyone without a pay-TV subscription is watching TV the old fashioned way, with an over-the-air (OTA) antenna. LRG found that 92% of TV households have a pay-TV service and/or an OTA antenna--compared to 94% in 2015.

Nielsen is gradually adding more data about virtual MVPDs, including (so far) Sling TV, Playstation Vue and DirecTV Now. Pivotal's Wieser says those vMVPDs add an incremental 1.5 million households to a broader definition of "Total Cable Plus" homes. But there were subscribers to vMVPDs a year ago--they just didn't get counted. Excluding the vMVPDs Wieser figures the number of pay-TV homes was down about 2.9% from a year ago. Including the vMVPDs likely reduce that to a decline closer to 2%, he said.

Will subscribers return? LRG's data shows that only 10% of non-subscribers plan to subscribe to a pay-TV service in the next six months. Meanwhile, 30% of people who moved in the past year do not currently subscribe to a pay-TV service--a higher level than in previous years.

ADVERTISER NEWS BJ's Wholesale Club will soon be up for sale again

according to The New York Post. The chain was taken private in 2011 by CVC Capital Partners and Leonard Green & Partners in a $2.8 billion deal and the owners are now looking to sell for $4-4.5 billion. Other private equity firms are seen as most likely buyers for the 213

warehouse chain which offers them a "steady $250 million annual revenue stream from fees members pay"......There's some movement towards a possible settlement of that strike against General Motors in Canada that threatens the supply of the Chevrolet Equinox. The two sides started to meet this week reporting some progress although the local's president said "several issues remain outstanding"......Sales numbers for the last several months have shown this, but new analysis from Edmunds confirms the midsize sedan "is no longer the vehicle of choice" for the American family. Midsize sedans had been the top-selling vehicle segment for 20 of the last 27 years but have fallen to fifth place this year (a 10.7% market share) behind compact SUVs, large trucks, midsize SUVs and compact cars. New Toyota Camry and Honda Accord models are coming out for 2018 with "edgier design and a sportier image," attempting to revive sales in the segment......Sonic drive-ins may be the next company to need to deal with security problems; its credit card processor told the company there's been some "unusual activity" regarding cards used at its locations, which may have led to credit and debit card numbers being sold in underground exchanges......Meal kits are still relatively new, but already there's a "value-oriented" alternative appearing on the scene. Supermarket News reports Dinnerly is looking to infiltrate the market at a $5 per serving price point and simplified recipes. The product launched on the West Coast a few months ago and has now rolled out nationally......Noting "the fastcasual revolution is over," Nation's Restaurant News reports that segment of the restaurant business averaged a 3.2% same-store sales decline in the second quarter, eliminating the volatile results from Chipotle Mexican Grill. NRN adds the decline has hit some small concepts particularly hard, even leading entire chains to shut down, which it sees as a rarity in a business in which investors are "routinely willing to take chances on existing brand names," and notes well over 100 fast-casual locations have closed so far this year......Freshii is closing 18 locations inside Target stores, saying "sales levels of these locations did not support a continued investment by both parties." The Toronto-based chain is still expanding in the U.S., currently working with multi-unit franchisees in California, Florida, South Carolina and Virginia.

CABLENET CHATTER

BLACK FRIDAY INCREASINGLY DIGITAL

John Legend is leading an effort to revive the WGN America

It's nearly two months away, but Salesforce is out with

series Underground. Legend was an executive producer a prediction that Black Friday will be the busiest digital

of the landmark series which focused on The Underground shopping day in U.S. history, exceeding Cyber Monday as

Railroad. In an op-ed posted on Wednesday, Legend the U.S. digital shopping day with the most sales for the

pointed out that shows like Underground are even more second year in a row.

important now given the events in places like Charlottesville. In making its 2017 holiday shopping season predictions

Legend took issue with Sinclair Broadcasting, which Salesforce combined insights on the activity of 500

purchased WGN America's parent company Tribune Media million global shoppers across 53 countries and billions

and canceled both scripted original series Underground of transactions powered by Commerce Cloud; millions

and Outsider in favor of what Legend called "cheaper of public social media conversations analyzed through

unscripted entertainment"......The unscripted crime series Marketing Cloud; and data from Salesforce's annual

Live PD will return to A&E for its second

Connected Shoppers Report.

season premiere on Friday, October 6th at 9 PM (ET) and 12 AM (ET). The show will air again on Saturdays in the same time slots. Live PD uses dash cams and handheld camera rigs to give a realtime glimpse into the policing of a varied mix of urban and rural police forces across the country on a typical Friday

An employee for the Buffalo Bills quit after the team took a knee during the national anthem

on Sunday. Meanwhile, an employee for the Los Angeles Chargers quit after watching

them play on Sunday.

Based on its data analysis, Salesforce says the most popular online shopping time for website visits and orders is from 8pm to 10pm. It predicts that consumers will only have 50% of their holiday shopping completed by Sunday, December 3rd and 80% completed by Friday, December 15th.

and Saturday night. A&E announced recently that it had given the program

Conan O'Brien

The forecast says Cyber Week (Thanksgiving to Cyber Monday) will see

a 100-episode order to the producer,

both the deepest discounts (average of

Big Fish Entertainment......Sherman

28% off list price) and highest rate of

Augustus, Babou Casey, and Ella-Rae Smith are joining free shipping (86% of all orders will have it). Beyond Cyber

the cast of AMC's Into the Badlands as series regulars. Week, Monday, December 11th will have the deepest

In addition, Dean-Charles Chapman and Lewis Tan will discounts and highest availability of free shipping.

join the show as recurring guest stars......MTV's Teen

Mobile traffic to retail sites will grow to 60% of total

Wolf series finale posted a season-high rating in the demo across the globe this shopping season (compared to 34%

of adult 18-34. The episode, which wrapped up the series for desktop and 5% for tablets), while orders placed on

sixth and final season, posted a 0.80 in the demo in the phones will approach 40% on big shopping days such as

Nielsen Live +7 ratings. The teen drama also helped MTV Black Friday.

log its third consecutive quarter-to-quarter growth for the

"Just like watching television, holiday shopping has

first time in 15 years in its target demo......The premiere moved from an appointment based activity to an on-

installment of Jordan Klepper's The Opposition boosted demand activity," said Rob Garf, VP industry insights,

Comedy Central's time period rating on Monday night. Salesforce Commerce Cloud.

The show delivered a .34 rating in adults 18-49. That was a

44% improvement over a year ago when @midnight took AUTOMOTIVE UPDATE

the timeslot previously held by The Nightly Show hosted

You've probably already guessed this, but new data

by Larry Wilmore. The Opposition held on to 74% of The from Edmunds confirms that families now prefer SUVs

Daily Show lead-in on a Live + Same Day basis. The new and pickups to the traditional midsize sedan, which had

show delivered 544,000 total viewers, 59% better than the spent 20 of the past 27 years as the best-selling vehicle

same night one year ago.... Spike confirmed to Deadline. category in the U.S. Midsize sedans were the top-selling

com that it has canceled its horror series "The Mist", vehicle segment as recently as 2014, but so far in 2017

based on a novella by Stephen King from the early 1980s have tumbled to fifth behind compact SUVs, large trucks,

after one season. The Mist, which marked Spike's first midsize SUVs and compact cars. Market share for midsize

original scripted series, was leftover from the old regime sedans is now a meager 10.7%--the segment's lowest

and programming strategy at the network, which will be share since Edmunds began its tracking in 1991. Even

rebranded as Paramount Network in January.

with new 2018 models of the two most popular cars in

the segment, the Toyota Camry and Honda Accord,

ACCOUNT ACTIONS

Edmunds analysts say it's highly unlikely the midsize

Sports footwear brand Asics has selected Saatchi & sedan segment will ever return to its former glory......

Saatchi as its global creative agency, succeeding 180LA. Cadillac has introduced its hands-free driving technology,

Asics spent an estimated $35 million on U.S. advertising sending a fleet of 12 Super Cruise-equipped Cadillac

last year......Adweek reports that the American Heart CT6 vehicles on a cross-country trip from New York City

Association has selected its first global agencies of record. to Los Angeles. The hands-free highway driving Super

The nonprofit selected CP+B Boulder as its first global Cruise technology will be offered beginning this fall on the

advertising AOR and Edelman as its global public relations 2018 CT6.

AOR.



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