Next Economic Downturn Could be Death Knell for Some Pay-TV Operators, TDG Says

Legacy pay-TV operators need to "stress test" their business models and work on liquidity and cost-cutting plans now, before the next economic downturn, The Diffusion Group senior adviser Joel Espelien blogged Tuesday. He said subscriber loss trends show the industry is unequivocally unhealthy, with declines to come regardless of whatever steps -- like promotions, discounts or bundles -- management takes in response. But the industry "is barely treading water" now in a strong economy with low unemployment, and today's manageable subs losses will likely accelerate -- perhaps to levels like 250,000 per quarter -- in the next serious downturn, he said: That could leave some weaker or heavily indebted pay-TV companies facing bankruptcy or insolvency.