Virtual MVPDs in the U.S. have seen fluctuating growth over the past six years but now the category has passed 14 million total subscribers as of the third quarter.
MoffettNathanson’s quarterly Cord Cutting Monitor report estimates that vMVPDs, led by Hulu + Live TV and YouTube TV, now have approximately 14.2 million combined subscribers after adding an estimated 980,000 subscribers during the third quarter.
Hulu + Live TV added 300,000 subscribers during the third quarter, compared to 700,000 additions in the same quarter of 2020. MoffettNathanson estimated YouTube TV added 225,000 subscribers, down from an estimated 400,000 in the same quarter of 2020.
The U.S. vMVPD category got a significant boost in subscribers from fuboTV, which 262,884 net subscribers in the third quarter (more than it added in all of 2020) and has since eclipsed one million total.
However, MoffettNathanson noted that while vMVPD subscriber growth accelerated quarter over quarter, it was still down significantly from the same quarter of 2020 when Sling TV, Hulu + Live TV, YouTube TV, DirecTV Stream (formerly AT&T TV Now), fuboTV and Philo added an estimated 1.7 million subscribers.
“No doubt part of the problem for vMVPDs is that their pricing is increasing converging on, well, reality,” wrote Craig Moffett in a research note.
Indeed, DirecTV Stream, Hulu + Live TV and Sling TV all recently raised prices and, given its recently renewed deal with Disney for channels including ESPN, YouTube TV may be due for a price hike soon, too, said MoffettNathanson.
“Recall that the vMVPD category is still only around six years old. Six years ago, everyone burst out of the gate with eye-poppingly low prices. That helped them get out of the gate quickly, but it undermined their longer-term prospects in two ways,” wrote Moffett. “First, they naturally attracted price sensitive customers, for whom regular price increase would be particularly irksome. Second, they painted themselves into the unenviable corner of having to raise prices even faster than their traditional distributor piers in order to accommodate the inevitable rate increases they would face from their content partners.”