The numbers are in a pay TV took a beating in the first half of 2019. It looks like it could get worse in the second half. The deal is done between CBS and Viacom. The new company ViacomCBS and Pluto TV could be a match made in heaven if CBS is ready to go all-in on free ad-supported TV online.
Chapter 1: Q2 pay TV subscriber results (1:00)
Leichtman Research says that pay-TV lost 1.5M subscribers in Q2 2019, a significant increase from Q2 2018. Satellite led the losses with cable not far behind. Bruce Leichtman says this is a fourth consecutive quarter of pay TV subscriber losses.
Pay-TV penetration continues to decline. It has fallen to 72%, and soon, SVOD penetration will be higher.
Chapter 2: What will happen to pay-TV in the second half? (10:00)
I discuss two reasons why pay-TV subscriber losses will likely accelerate in the second half of the year. A strategic change by some operators and competition from new entrants, particularly from a new Disney bundle, could drive up losses in the third and fourth quarters. Consumers are also more confident in alternative services like vMVPDs.
Chapter 3: ViacomCBS and Pluto TV (16:30)
Viacom has embraced the FAST approach with its purchase of Pluto TV. It is launching popup channels on Pluto to help it recapture young viewers that are leaving its linear TV channels for online FAST services. CBS should embrace this concept and leverage some of its library content and big show names to launch popup channels on Pluto TV.