Netflix‘s unprecedented levels of spending seem to be finally paying off. According to data published by the media research firm Leichtman Research Group, Inc., Netflix subscribers now outnumber cable subscribers in the United States. Leightman reports that Netflix subscriptions overtook cable in American households in the first fiscal quarter of 2017, during which cable suffered some of its worst losses ever.
According to Leichtman’s data, the top six cable providers lost a combined 115,000 subscribers in Q1 2017. The president and principal analyst of Leichtman Research Group, Bruce Leichtman, says that the data don’t mean that more people are cutting the cord, but merely that fewer households are signing up for new cable subscriptions:
The pay-TV market lost about 410,000 subscribers in the first quarter of 2017. This marked the first time that the industry has ever had net subscriber losses in the first quarter of a year. The decline in subscribers should not be interpreted as solely driven by a sudden increase in consumers disconnecting services. The net losses are also a function of a decrease in new connects, partially due to some providers less aggressively pursuing lower value customers than in the past.
The top satellite providers, DIRECTV and DISH, also saw significant subscription losses in Q1 2017, while internet-delivered services like Sling TV and DIRECTV NOW grew substantially. Netflix, meanwhile, has new subscribers pouring in – and not just in the United States. Other streaming services are expanding just as fast and will likely soon catch up – Netflix just got the jump on the market by being one of the first big names in streaming video-on-demand. Couple this new data with the fact that millennials overwhelmingly prefer streaming over cable, and it’s easy to see that the future of TV will be cable-free.