U.S. vMVPD subscribers will total 23M by 2024: report

Traditional pay TV services will continue to shrink while virtual MVPDs like YouTube TV and Hulu will spark substantial growth over the next three years.

That’s based on new estimates from Parks Associates, which predicts that the U.S. vMVPD subscriber base will increase to more than 23 million households by 2024, while traditional pay TV services will shrink to 53 million households during the same time period.

That represents a precipitous drop for traditional pay TV, based on estimates from Parks and other analyst firms. Kristen Hanich, senior analyst at Parks Associates, said that as of the fourth quarter of 2020, U.S. traditional pay TV subscriptions were at 69.6 million. After the first quarter, MoffettNathanson estimated the total subscriber base for traditional pay TV—cable, satellite and telecom—to be approximately 75 million and Leichtman Research estimated the total to be 72 million.

Since not all vMVPD providers regularly provide public disclosures around subscriber totals, that figure is a little trickier to estimate. After the first quarter, MoffettNathanson estimated an approximate 11.75 million total vMVPD subscribers across YouTube TV, Hulu + Live TV, Sling TV, AT&T TV and others—which likely includes fuboTV, Philo and other smaller vMVPDs. Parks estimated the total to by 13.4 million subscribers after the fourth quarter.

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"Online pay TV service from virtual MVPDs, players that target the general population instead of offering services to a specific geographic footprint, grew by an estimated three million," said Hanich in a statement. "vMVPDs overall have grown to represent an increasingly large percentage of the pay TV market — accounting for 16% of U.S. pay TV subscriptions in 2020."

MoffettNathanson estimated that the conversion ratio of traditional MVPD customers to vMVPD customers has dropped down to about 34% relative to where it was at in 2018 and 2019. But Parks new figures suggest that figure could rise in the coming years.

If vMVPDs are due for significant growth over the next three years, the previous quarter may not be the best indicator of overall trajectory. FuboTV was one of the only U.S. vMVPDs that reported subscriber gains (43,000) while Hulu + Live TV and Sling TV reported a combined 300,000 net losses.

Traditional pay TV—which Parks defines as television services delivered over an operator-controlled network to an operator-controlled device—have helped contribute to 18 million total losses for the U.S. pay TV industry from 2014 to 2020. That includes 10 million traditional pay TV subscribers lost last year.