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Premium channels strike back: Showtime, HBO and Starz say they're adding subscribers, not losing them

Richard Lawler, @Rjcc
January 21, 2014
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Yesterday The NPD Group released data from a survey showing fewer US TV watchers are subscribing to premium cable channels, but now the networks say that isn't true. As first reported on the LA Times Company Town blog, spokespeople from HBO, Showtime and Starz have all refuted the numbers. Of the three, only Starz is publicly traded and reports its subscriber count quarterly, so it has the most detailed stats. While the fourth quarter numbers won't be out for another month or so, its customer count is at 22 million as of Q3, up 1.2 million from a year before, and 1.9 million 18 months prior.

HBO and Showtime don't release the same kind of numbers, but point to stats from another market researcher, SNL Kagan that show their subscriber count and market penetration growing consistently over the past few years. According to Showtime, it's added one million customers per year, each year, for the last six years. Rich Greenfield of BTIG also points to quarterly earnings snippets that indicate recent growth for premium TV channels and considers the results of NPD's 7,500 household survey to be "misleading/meaningless." So why the discrepancy? Looking at the NPD chart, we see it measure the percentage of internet households with premium channels, so it could be skewed by people recently adding internet, but not premium channels. Whatever the case, even as Netflix (which will report its Q4 numbers tomorrow afternoon), Amazon, Hulu, Redbox and the rest expand, it appears the old model of TV distribution isn't on its deathbed just yet.

Update: As reported by The Wrap, NPD has pulled the original report from its website, and is reviewing its data.

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