Comcast added about 300,000 total broadband customers in the third quarter, less than half the 633,000 additions it had in the same period last year, but slightly ahead of the slowdown that some analysts predicted for the company.

That should be a relief for some investors, who back in September feared the worst after Comcast chief financial officer Mike Cavanagh warned at an industry conference that subscriber growth for high-speed internet service was slowing down a little more than expected in August.

Analysts scrambled to revise their growth models for the sector, with most coming close to what Comcast actually reported on Thursday morning. Wells Fargo analyst Steven Cahall estimated that Comcast would add about 295,000 broadband customers (down from his previous estimate of 395,000 additions), Evercore ISI Group media analyst Vijay Jayant predicted 280,000 residential additions (Comcast added 281,000 residential and 19,000 business customer additions) and MoffettNathanson principal and senior analyst Craig Moffett predicted 302,000 total additions. Overall analysts' consensus estimates were for 296,000 broadband additions.  

Also Read: Peacock Losses Rise in Quarter 

Broadband helped drive strong revenue and cash-flow gains in the cable side of the business for the quarter. Comcast said cable communications revenue was up 7.4% to $16.1 billion and adjusted EBITDA rose 10.3% to $7.1 billion.

Wireless subscribers rose by 285,000 in the period, the best quarterly gain since its launch in 2017. Comcast ended the quarter with 3.7 million wireless lines. 

Overall revenue was up 18.7% to $30.3 billion, and adjusted EBITDA rose 18.1% to $9 billion. Net income rose 34.6% to $4 billion. On the programming side, NBCUniversal revenue was up 57.9%, driven by a 47.5% increase at its Media unit, which benefited from the  Summer Olympic Games. Minus the Olympics, Media revenue would have risen about 9.2% in the period.  

In a press release, Comcast chairman and CEO Brian Roberts said he was pleased with the company’s Q3 performance, especially at its cable unit. 

“At Cable, our customer and financial metrics remained strong, highlighted by 10% growth in adjusted EBITDA, the highest level of customer retention on record for a third quarter, and the most wireless net additions since the launch of Xfinity Mobile in 2017,” Roberts said. “Going forward, I am excited about the opportunity to continue to invest in our global technology platform and other businesses while returning more capital to shareholders.” 

Lachlan and James Murdoch sure didn’t sound like two media chiefs hot to unload their programming assets Wednesday, spending a good portion of 21st Century Fox’s fiscal first quarter earnings call touting the growth prospects for their cable and satellite operations.

But while neither executive would directly address speculation around their desire to sell assets, they didn’t quite squash all of chatter either.

Fox was said to be in talks, since ended, to sell its movie studio and cable assets like FX Networks and National Geographic channel as well as its 39% stake in European satellite company Sky to The Walt Disney Co. While Fox co-executive chairman Lachlan Murdoch opened up the earnings call telling analyst he would not respond to media speculation, he had plenty of wind left to tout the company’s ongoing operations.

Overall results were strong – revenue was up 8% in the fiscal first quarter and affiliate fee revenue for its cable channels rose 11%, due to contractual increases across all of its brands.

“We told you many years ago that innovative disruption would come to our industry,” Lachlan Murdoch said on the call. “…We moved early to jettison our thin brands and went deep with investments for our rich distinctive brands, when many market pundits were skeptical of this approach.”

He added that because of that strategy, Fox’s brands have full carriage on all traditional and newly launched platforms.

“There is a lot of talk about the growing importance of scale in the media industry. And let me be very clear, Fox has the required scale to continue to both execute on our growth strategy and deliver increased returns to shareholders,”  Lachlan Murdoch said. “We are specifically seeing this in our affiliate fee growth again this quarter and the success of Hulu and our inclusion in all of the emerging MVPDs. We are excited about all of our brands and the breadth of opportunity they continue to offer.”

Asked if the changing landscape Fox is rethinking its asset mix and whether scale matters less or more today, CEO James Murdoch said that the company has changed its portfolio over the past several years.

“We’ve really simplified our operating model, we’ve got a great set of brands and a great set of assets that we really like,” James Murdoch said. “And as you can see from these quarterly results and from the past couple of quarters I hope, a real trajectory of good performance.”

James Murdoch also commented on plans to fully consolidate the Sky satellite TV business, adding that the company continues to work with U.K regulators and hopes to receive approval of the transaction by the middle of 2018.

TiVo’s business has been rapidly shifting from hardware to software, and that business shift was clear as day in the company’s third-quarter results.

“TiVo has moved well beyond a hardware company and is now an innovative entertainment technology company,” Thomas Carson, TiVo’s president and CEO, said on the company's earnings call Thursday (Nov. 2). “To that point, 95% of our revenues this quarter came from software, services, advertising and licensing.”

Though it’s not a core focus, TiVo is still keeping its hand in the retail hardware business amid the launch of a new lineup of Vox-branded products that add voice navigation and a new user interface.

RELATED: TiVo Refreshes Retail Lineup With Voice-Powered 'Vox' Devices

TiVo said Q3 revenue rose 29%, to $197.9 million, driven by the merger between TiVo and Rovi that closed last fall. That was paired with a net loss of $17 million, versus net income of $49.9 million a year ago that factored in a $83.4 million tax benefit. TiVo expects full-year revenue in the range of $810 million to $830 million, with about $35 million coming from hardware sales.

Carson, who plans to retire from the company (a search for a successor is ongoing), reiterated that TiVo’s business now covers three categories: Platform Solutions (user experience software for pay TV operators in developed and emerging markets); Software and Services (metadata, advanced search and recommendations, voice search and advertising); and Licensing.

Though TiVo has made progress on that last category, having signed recent deals with AT&T and Liberty Global, the overhang continues due to the lack of a deal and a protracted legal battle with Comcast.

RELATED: TiVo Shares Soar on Prelim ITC Ruling Against Comcast

Getting Comcast under license “remains one of our top priorities,” Carson said. 

Regarding the pending action at the International Trade Commission, Carson said TiVo expects a final determination to be issued on Nov. 9.

Discovery Communications is positioning itself to help distributors find the net while looking for new content to fill traditional and non-traditional pay TV offerings both in the U.S. and internationally, CEO David Zaslav told analysts Thursday.

On a conference call with analysts to discuss third-quarter results, Zaslav said Discovery sees its pending purchase of Scripps Networks Interactive in furthering that strategy, giving it the compelling content that traditional and non-traditional distributors crave.

Zaslav said that the future seems to be pointing to large tech companies like Google, Amazon, Facebook and Apple getting deeper into the content delivery weeds. But as they expand their offerings, they’re going to need to partner with content creators.

Related > Facebook Willing to Experiment With Video

“We think that if Apple wanted to do a deal with one person and offer a Family Pak everywhere in the world, or if Facebook wanted to do that or Amazon or if the mobile players wanted to do it in Europe, who could they go to?” Zaslav asked on the call. “There [are] very few companies; it’s maybe less than three.”

Discovery and Scripps, which have established worldwide brands, are among that group.

“We see Scripps as a beginning,” Zaslav said. “Within two years we will be less than three-and-a-half-times levered. And we will be looking for what other IP do we have, how do we accelerate direct-to-consumer, how do we accelerate our overall market share. We think we are trying to be where the ball is. We see those big distributors are looking more and more for the ball, and the ball for them is content.”

Related > Discovery-Scripps: Thin Is In

Zaslav has been a big proponent of skinny bundles, and he has continued to point out how in Europe, sports-free packages are prevalent. On the call he said that the lack of a compelling non-sports bundle is one of the factors in the 3% decline in pay TV subscribers, and predicted such smaller offerings would become prevalent in the U.S., eventually.

While Discovery has had success with smaller bundles in Europe, it has been missing from key offerings in the U.S. from Hulu and YouTube. But Zaslav pointed out that Discovery is on DirecTVNow and Sony PlayStation Vue and is in talks with other OTT providers for carriage, He hinted that could come after the Scripps deal closes, expected early next year.

AMC Networks reported higher third-quarter profits as programming costs fell and domestic ad revenue increased.

Net income rose 33% to $87 million, or $1.35 per share, from $65 million, or 91 cents a share, a year ago. Revenue rose 2.1% to $648 million.

Adjusted operating income for AMC’s domestic networks rose 22.9% to $199.7 billion as they incurred lower programming and marketing expenses.

Revenue at the domestic networks increased 4% to $541.4 million.

Domestic advertising revenue was up 4.5% to $198 million because of higher prices.

“We delivered strong financial performance in the third quarter, and we are on track to meet our 2017 full-year financial targets of total company revenue and adjusted operating income growth,” said CEO Josh Sapan.

“Our results reflect the consistent execution of our long-term strategy of investing in high-quality, immersive content that is resulting in growing demand among traditional distributors, virtual MVPDs, advertisers and consumers; and, importantly, is giving us the ability to monetize the demand for our content through new revenue streams,” Sapan said. “In an evolving media and entertainment marketplace, AMC Networks is well positioned based on our size, our pricing and our content, which includes four of the highest-rated dramas on all of basic cable, giving us the ability to continue to further invest in our content, our brands and new businesses."

Mid-sized cable operator Mediacom Communications added 9,000 high-speed internet customers in the third quarter, offsetting a loss of 6,000 video subscribers and helping to fuel a nearly 4% revenue gain in the period.

Mediacom grew revenue to $471.6 million, or about 3.8%. The video losses in the seasonally weak period were an improvement over the prior year, when Mediacom shed about 8,000 video customers. The operator also added 22,000 phone customers in the period.

RELATED: Mediacom Refinances Bank Facilities

Operating income before interest, depreciation and amortization (OIBDA, a measure of cash flow) was up 2.3% to $173 million in the quarter, and overall customer relationships rose 1.4% to 1.4 million. Mediacom ended the period with about 823,000 video subscribers.

The number of ad impressions in video-on-demand programming from cable operators working with Canoe jumped again in the third quarter.

Ads served in VOD programming generated 5.668 billion impressions in the third quarter, up 48% from 3.812 billion a year ago, the company said. Canoe serves 36 million households that subscribe to Charter, Comcast and Cox.

Canoe ran a total of 3,208 campaigns in the quarter, up 51% from 2,123 a year ago.

Related: Canoe Marks 100 Billion Spots Inserted in VOD Programming

VOD ads are becoming increasingly popular as viewing increases and as more networks enable dyanmic ad insertion technology, which allows advertisers to better target their commercials. Last year's totals were impacted by the election, which soaked up viewer attention.

About 24% of the Q3 campaigns were network tune-in campaigns. The others were for clients in a wide range of categories. The breakdown was similar last year.

So far this year, Canoe’s ads have generated 17.9 billion impressions, up from 12.8 billion at this point a year ago.

Related: Set-Top VOD Ads Must Evolve to Survive

Canoe said that 99% of the time consumers watch mid-roll ads to completion. In pre-roll the completion rate is 99.18% and it is 91.35% in post-roll breaks.

The bulk of Canoe’s ad impressions are created by mid-roll ads, which generated 4.684 billion impressions, compared with 896.7 million pre-roll impressions and 87.2 million post-roll impressions. 

Read more at broadcasatingcable.com.

Pay TV subscribers were leaving the ranks in the third quarter at about the same rate they did last year, but some analysts are bracing for the impact that new over-the-top offerings from DirecTV and Hulu might have on overall cord-cutting.

The pay TV industry lost about 486,000 subscribers in the third quarter, similar to the 436,000 net loss in the same period last year, according to MoffettNathanson principal and senior media analyst Craig Moffett. But if you add over-the-top provider Sling TV to the mix, the losses add up to 282,000 versus 277,000 last year.

Improvement in the cable sector, which lost 124,000 customers in the period vs. 218,000 in Q3 2015, wasn’t enough to offset continued heavy losses in the telco TV sector — down 365,000 subs in the quarter compared with 41,000 subs lost in Q3 2015 — and sluggish growth in satellite TV.

Leichtman Research Group president and principal analyst Bruce Leichtman estimated that pay TV lost about 255,000 subscribers in Q3, slightly higher than the 210,000 losses he estimated in the prior year.

“While the narrative is, ‘This market is falling apart,’ that’s not the reality,” Leichtman said. “What we’re really seeing is a market, which we have been seeing for the past four years, that is saturated and in slow decline.”

A WINTER OF DISCONTENT

But Moffett warned that while the seasonally weak summer months were stable, winter may be coming for the industry. AT&T’s DirecTV Now, the aggressively priced ($35 per month) 100-channel OTT service, is scheduled to launch later this month, and Hulu is expected to release its live-streaming service in the first quarter of 2017.

Moffett said pricing will be key. If DirecTV Now follows through with a $35 price point that is more than just an introductory base price — and Moffett is skeptical — the service could truly be the “game-changer” its management has spoken often about.

“AT&T is taking its content partners for a dance on the edge of a cliff,” Moffett wrote. “It is next quarter, and the quarter after, that will matter. The music has barely begun to play.”

In the meantime, traditional strong points for the pay TV sector continue to be pressured, with satellite and telco TV video losses mounting (see chart).

Dish Network continued to lose net new subscribers by the bucketful in the third quarter; it was down an estimated 320,000 subscribers, not including gains at Dish-owned Sling TV, according to Moffett. Including Sling TV gains of about 204,000 customers, Dish lost 116,000 net subscribers in the period.

At DirecTV, strong gains — 323,000 net additions — in Q3 couldn’t offset heavy losses at parent AT&T’s U-verse TV service. U-verse TV shed 329,000 video customers in Q3, three times the 92,000 subscribers it lost in the prior year, as it transitions customers to DirecTV’s satellite platform. Verizon Fios managed to add about 36,000 video customers in the period, even with last year’s 41,000 additions.

Leichtman saw the share shift between telco and satellite as more of a business decision than a change in consumer preference. He noted that the telco sector added 1.6 million video subscribers in 2014 and lost 1.4 million video customers in the past year. Of those 1.4 million losses, 1.33 million were from AT&T.

“What we’re seeing is a share shift driven by a decision that AT&T has made, not by consumers moving away from telco TV,” Leichtman said.

CABLE’S BROADBAND EDGE

Broadband has apparently been the difference for the cable companies as cable’s high-speed Internet customer growth has far outpaced the telcos’ for decades.

Leichtman estimated that broadband added about 3 million customers in the past year, and said cable accounted for more than 115% of that growth.

“Cable added nearly 3.5 million broadband subscribers, and the telcos are losing,” Leichtman said. “The bundle is as important as it has ever been.”

BTIG media analyst Rich Greenfield estimated that pay TV subscribers from all sources are declining at a 0.9% rate year-to-date and the rate is likely worse among the privately held MVPDs. In a blog post, Greenfield wrote that he is more concerned about cord-shavers — subscribers who are opting for skinny bundles — than those who are severing the relationship altogether.

Cord shaving raised some stubble in late October, after Nielsen estimated that ESPN lost 621,000 subscribers in one month, double the normal rate. Disney has disputed the figures — Nielsen stands by them, and they show increased losses at other networks — but affiliate fees declined in Q3 in part because of a declining base.

Disney chairman and CEO Bob Iger said he was bullish on ESPN’s future, adding that the main reason for the subscriber losses — migration to smaller packages — is easing. He also was encouraged by new deals with digital and over-the-top providers.

But it is just those digital and OTT providers that Greenfield is most worried about.

Greenfield pointed to the new virtual MVPDS, most concerned with the absence of friction in the subscription process. Customers can sign up and drop the service at any time with a click of a mouse, without having to return equipment or pay early termination fees.

“While this clearly may lead to new subs entering the ecosystem,” Greenfield wrote, “we are far more worried about the aforementioned 88 million video subscribers shifting to platforms where they no longer need to pay for an entire year of service to access the content they are most interested in.”

SIDEBAR: Birds and Wires

AT&T’s continued migration of U-verse TV customers over to DirecTV dominated Q3 telco TV losses, while cable managed to reduce subscriber declines in the period.

      Q3 2015                     Q3 2016

Total Cable Adds . . . . . . . . . . . . . (218) . . . . . . . . . . . . . . (124)

Satellite TV Adds . . . . . . . . . . . . (152) . . . . . . . . . . . . . . . . 3

Telco TV Adds . . . . . . . . . . . . . . .  (41) . . . . . . . . . . . . . . . (365)

Sling TV Adds . . . . . . . . . . . . . . . . 155 . . . . . . . . . . . . . . .  204

Total Net Adds . . . . . . . . . . . . . . (277) . . . . . . . . . . . . . . (282)

Source: MoffettNathanson estimates; figures in 000s; numbers in parentheses represent declines.

Despite continued declines in the pay TV sector, programmers continued to report strong affiliate-fee increases in the third quarter. The results indicate that live, on-demand and other programming offerings may still have value, but skeptics said programmers are in for a big surprise as old deals roll off.

Content providers for the most part have been losing an average of about 2% of their subscribers in the past several quarters. The losses mainly reflect a growing shift away from traditional television viewing to over-the-top and mobile services such as AT&T’s upcoming DirecTV Now, slated for a mid-November launch, and more-established services like Sony’s PlayStation Vue, Amazon Video and Hulu Plus.

RATINGS SHRINK, FEES GROW

But while fewer subscribers has led to lower ratings and slower ad-revenue growth for most of the major programmers, affiliate fees continue to climb.

While that may just be a factor of different license renewal cycles and higher pricing, it could also mean that the traditional, linear pay TV network has more value than some critics think.

For programmers, the litmus test may be 21st Century Fox, which expects between 15% and 20% of its programming footprint to come up for renewal by the end of the year. 21st Century Fox, parent of the Fox broadcast network and news and entertainment programmers such as Fox News Channel, Fox Business Network and FX, reported an 8% increase in affiliate fees in the fiscal first quarter, up from a 6% increase in fiscal Q4. And the company said that it expects affiliate revenue to continue to grow at that pace or higher as new deals come online.

What intrigued some analysts, though, is that Fox claimed the increased affiliate fees didn’t come from higher pricing, but from greater volume. Fox channels actually added subscribers in the fiscal first quarter, bucking the recent trend.

Fox attributed the subscriber increases to the movement of networks like FX, movie channel FXM and sports network FS2 into broader bundles and new deals with over-the-top distributors.

Fox already has deals with Sling TV, PlayStation Vue, Amazon Fire TV, Apple TV and is reportedly close to finalizing an agreement to be included in DirecTV Now. The programmer, a partner in the online video service Hulu with Comcast’s NBCUniversal and The Walt Disney Co., will also appear in that company’s live streaming service expected early next year.

On a conference call with analysts to discuss its earnings results last week, Fox CEO James Murdoch said that while some of the upcoming Fox News renewals are for older contracts that could see a hefty price increase to align them with other distributors, “the channel is as strong as ever.”

“We feel that the product has enormous amount of value to customers and that’s reflected in its ability to and our ability to continually grow those affiliate fees,” Murdoch said on the call.

It may be a little early to call this a new trend, MoffettNathanson senior research analyst Michael Nathanson wrote in a client note. But he added the Fox difference could be tied to its programming mix — live sports on the Fox network, sports channels like FS1, FS2 and regional sports channels, as well as general-entertainment programming on FX, FXX and Fox.

“We continue to believe that owners of must-have, live, scaled content (like Fox) have pricing power despite the consolidation of the MVPD industry,” Nathanson wrote.

Fox still needs to prove it can grow affiliate fees in the latter half of the year and show some non-programming related cost discipline at its cable networks, according to Nathanson. “The first quarter is a good start in the right direction,” Nathanson wrote.

FOX AN OUTLIER?

Telsey Advisory Group media analyst Tom Eagan attributed most of the Fox subscriber gain to its “emerging networks” like FS2. He added that other programmers probably won’t see the same result because they don’t have as many emerging networks.

Barclays media analyst Kannan Venkateshwar agreed. In a note to clients, he said the growth was due to newer channels like FXM, Fox Business and FS2 getting broader distribution.

“[I]t is not clear how sustainable this trend is given these are likely noncore networks, especially in a skinny bundle world,” Venkateshwar wrote.

Still, Eagan said he believes the next renewal cycle will be difficult for programmers, as distributors point to lower ratings and declining subscribers to push for lower fees.

“For the more independent networks, it’s going to be more challenging,” Eagan said.

Cable operators appear poised for a strong third quarter on the heels of Comcast’s stronger-than-expected results, with satellite TV continuing to slide.

Comcast outpaced most analysts’ expectations by adding 32,000 basic video subscribers in the third quarter — its best Q3 showing in a decade and well above consensus estimates of about 1,000 customer additions.

The performance helped to solidify what many analysts who follow the sector have been saying for a while: Cable is king, for now.

Comcast’s performance in light of a declining overall pay TV customer base shows cable is taking back market share. According to MoffettNathanson principal and senior analyst Craig Moffett, that performance was largely driven by the success of its X1 platform — now available in 45% of its footprint — and continued strength in broadband. Comcast added 330,000 broadband customers in the third quarter, its best Q3 performance in eight years.

CHARTER, ALTICE ON DECK

While other operators aren’t expected to fare quite as well, they are expected to show improvement on both the video and broadband front.

Charter Communications and Altice USA, parent of the former Cablevision Systems and Suddenlink Communications, are expected to release their Q3 results on Nov. 3 and Nov. 10, respectively, the latter as part of Altice N.V.

Analysts generally expect marginal video-subscriber losses for Charter — ranging from about 20,000 to 30,000 customers — but with momentum building later in the year.

The same holds true for Altice USA. Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak expects strong cash-flow growth from the U.S. cable unit, fueled by cost efficiencies, a $5-per-month price hike for data service at Suddenlink and continued cost-cutting by the Optimum (formerly Cablevision) operations.

Wlodarczak estimated that revenue-generating units, a combination of voice, data and video customers, will decline by 25,000 for Suddenlink and by about 30,000 for Optimum.

At Charter, Morgan Stanley media analyst Ben Swinburne expects more churn as customers roll off of legacy TWC promotional pricing, leading to a loss of about 34,000 video customers in Q3.

Charter will add about 390,000 broadband customers in the quarter, well above the prior period gain of 236,000 subscribers.

Charter continues to integrate Time Warner Cable and Bright House Networks operations — the deal closed in May — and Swinburne believes that after a slight early hiccup, a strong growth trajectory should continue. “We continue to believe Charter shares offer investors a rare levered equity growth story, particularly given the visibility into that growth and capital allocation for a company of its size,” he wrote.

Swinburne said recent results — in the second quarter, video losses improved to 152,000 from 170,000 in the year-earlier period, and revenue and cash flow grew by 6.6% and 9%, respectively — reaffirms his view that Charter “can successfully implement the strategy it has proven out over the last four years on its now-larger footprint.”

Overall, cable should have a good quarter on the subscriber front. Swinburne estimated that MSOs should collectively lose about 20,000 video subscribers, amended from the 52,000 he predicted earlier when he believed Comcast would lose 8,000 customers in Q3.

If cable is to be the king for the period, though, Telsey Advisory Group media analyst Tom Eagan pegs Dish Network as a pauper.

DOWN ON DISH NETWORK

Dish is coming off a string of subscriber losses — it shed 28,000 in the first quarter and 281,000 in Q2 — and the third quarter is expected to be no different. Eagan expects Dish to shed about 125,000 customers in the third quarter, ending the period with 13.3 million subscribers.

“Dish’s business model is proving increasingly unsustainable,” Eagan wrote in a research note. While cash flow will likely increase 20% for the year, that is due more to easy comparisons with 2015. Even Sling TV, which is expected to end the year with about 700,000 customers, according to Eagan and has been the main focus of the company, could be impacted by AT&T’s over-the-top offering, DirecTV Now. AT&T said it plans to launch DirecTV Now in November at $35 per month for more than 100 channels. Sling TV sells at $20 per month for more than 25 channels.

Swinburne was equally down on Dish’s prospects — he predicted it would lose about 155,000 subscribers in Q3 and estimated it would shed between 650,000 and 660,000 subscribers per year through 2019, partially offset by average annual gains of 240,000 to 245,000 customers for Sling TV.

“We expect these trends to continue over the medium-term, particularly given cable’s investment in its product and the likely launch of new offerings in 4Q16 (DirecTV Now) and 1H17 (Hulu),” Swinburne wrote.  

Comcast is expected to reverse the trend of video customer losses in the third quarter, with analysts predicting it will end the year in positive territory, the first time the nation’s largest cable operator has flirted with that milestone in about a decade.

Comcast has been on track to finish the year with more video customers than it started with, adding 58,000 TV subscribers in the first quarter and losing just 4,000 in the second.

Positive growth has been a trend in the past year for the big cable operators. Charter Communications did it in 2015 with 11,000 video additions, as did Time Warner Cable (purchased by Charter in May 2016) with 32,000 additions. For both, it was the first year of positive video customer growth in more than a decade.

Q3 NUMBERS THIS WEEK

Now Comcast, which has toyed with full-year video subscriber growth in the past, is expected to join the party. Comcast has turned in several recent quarters in the black, but it hasn’t had a full-year of growth on the video side since 2006, when it posted a gain of about 100,000 customers.

That should change this year, according to several analysts, starting with the third quarter. Comcast is scheduled to release Q3 financial results on Oct. 26.

Comcast might stand alone on the video growth podium this year: most analysts predict Charter will have a small video subscriber loss in 2016 — ranging from 32,000 to 65,000 — as it integrates TWC.

Altice USA, which purchased Suddenlink Communications and Cablevision Systems in the past 12 months, has improved losses but isn’t expected to enter positive territory just yet.

For Comcast, the growth estimates for the year range from about 50,000 subscribers from Credit Suisse media analyst Omar Sheikh to 130,000 from Morgan Stanley media analyst Ben Swinburne.

Pivotal Research Group CEO Jeff Wlodarczak estimated in a September research note that Comcast would report flat third-quarter video customer growth, rallying to end the year with 109,000 more video subscribers than the year before.

With companies the size of Comcast, a loss of 30,000 customers, a gain of 30,000 customers or no growth at all is basically a rounding error, Wlodarczak said, although positive growth should help with investor sentiment.

Comcast has been working hard to reduce video customer losses for about five years — it first spoke of efforts to reduce video churn in 2011.

OPERATIONAL GAINS

During that time, Comcast has made big strides to improve the video customer experience, whether it be pushing for full-season stacking rights for shows or launching its state-of-the-art X1 platform, currently available in about 40% of its homes with the goal to be in 50% by the end of the year.

X1 has been a differentiator, offering an elegant user interface coupled with greater functionality and features. Last week, the company added to those features, including a “Team Reminder,” which notifies customers of live games, pre- and post-game shows and other programming featuring their favorite sports team.

Wlodarczak said that X1 has been a factor in video customer improvements, but he added that the competition has helped, too.

“Yes, the churn benefits of X1 help,” Wlodarczak said. “It also helps that AT&T is focused on marketing DirecTV and Comcast can lever their best-in-class data product to get consumers to sign up for video services.”

Cord–cutters, shmord-cutters.

The notion that cord-cutting millennials will erode the cable business into oblivion is being turned on its ear, as cable operators across the board are reporting some of their best video-customer results in nearly a decade and their younger, cooler satellite and telco TV counterparts have encountered mounting losses.

The trend continued last week as Cablevision Systems reported better-than-expected results in third-quarter 2015. Cablevision — which has been a victim of its own success and stepped up promotional efforts by telco Verizon Communications — reported a loss of 33,000 basic-video customers, a 10.5% improvement over the 56,000 video customers it lost in the same period in 2014.

Though customers are still leaving, the erosion has slowed. The results build on those of Comcast, Time Warner Cable and Charter Communications, each of which in the past few weeks reported their best basic-video customer improvements in about a decade.

Comcast was first out of the blocks, reporting on Oct. 27 a third-quarter loss of 48,000 video customers, nearly half of what it shed in the same period last year and its best third-quarter performance in nine years. It was followed by Time Warner Cable, which shed just 7,000 basic-video customers (compared to a loss of 184,000 in the prior year), and Charter Communications, which gained 12,000 basic-video customers, its first increase since the fourth quarter of last year and a big improvement over its 9,000-customer loss in Q3 2014.

CABLE HOLDS ITS OWN

And telco-TV providers are no longer taking up the slack for cable losses. In the third quarter, AT&T — which completed its $48.5 billion purchase of satellite giant DirecTV in July — reported a loss of 92,000 U-verse TV subscribers. At the same time, Verizon Communications said its FiOS TV service added 42,000 customers in the third quarter, one-third of the 114,000 it added in the same period last year.

The improvements reveal that even in the face of stiff competition (Cablevision has the greatest exposure to Verizon’s FiOS TV product at 49% of its footprint), cable has managed to hold its own.

The trend of cord-cutting — stopping monthly subscriptions to MVPDs — isn’t over by any means. Collectively, all pay TV providers are still losing customers, and most are expected to do the same in the fourth quarter. What’s new is, cable is gaining share in relation to its telco and satellite rivals.

The results have some analysts wondering if they should rethink the whole cord-cutting concept.

“It is time to ask whether we’ve got the story right,” MoffettNathanson principal and senior analyst Craig Moffett wrote in a recent research note.

But not everyone sees a sea change. Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said AT&T was likely distracted by its merger with DirecTV — satellite-TV provider DirecTV added 26,000 net new customers in the period, compared with a year-ago loss of 28,000 net customers — and should recover in later quarters. And the practice of “cord-shaving,” or migrating to a less-expensive video package, including basic cable, may explain some of the industry’s performance, he said.

From almost the beginning, cord-cutting was seen as a cable problem, Moffett continued, and investors took solace in the fact that MSOs at least had the broadband business to fall back on, if video revenue were to disappear.

Broadband has played a major role, and cable is by far the dominant provider of that service (in the second quarter, cable accounted for 100% of broadband customer additions, only the second time that has ever occurred).

But cable’s relentless focus on expanding its video-on-demand libraries and lineups, enhancing its user interfaces and beefing up its authenticated TV everywhere offerings and apps have also made it and its much maligned video, voice and data bundle into a more attractive choice.

MORE THAN BROADBAND

“Cable is now unmistakably taking share from satellite, and telco TV is fading fast,” Moffett wrote, adding that broadband deserves some credit for the transformation.

“But some of it owes to fundamental changes in the way we are watching TV,” he added. “Cable’s two-way architecture and Comcast’s best-in-class user interface and VOD libraries are emerging as genuine sources of competitive advantage.”

Comcast’s X1 operating system is seen by many as the gold standard for content navigation. At the recent Next TV Summit in New York, Bank of America Merrill Lynch media analyst Jessica Reif Cohen half-jokingly wished that regulators had approved Comcast’s merger with Time Warner Cable just so New Yorkers could finally experience the X1 interface.

And seamless navigation is becoming critical to cable operators’ survival. Clunky text-only, scrolling interfaces offered by many providers are now met with derision by customers who find their smartphones are much more intuitive.

With new sources of traditional shows and short-form content emerging practically every day, finding an elegant way to choose entertainment has become a priority not only for consumers but for the content providers as well.

Last week during the company’s earnings conference call, The Walt Disney Co. chairman and CEO Bob Iger listed his top three essential elements for media success. No. 2, in between high-quality programming and mobility, was creating a “fantastic user experience with incredible interface navigation.”

“You have to make the service easy to use and the content easy to find,” Iger said.

CLOSING THE WINDOWS

Other programmers are getting into the act as well. Last week Time Warner Inc. chairman and CEO Jeff Bewkes said the programmer is evaluating whether to retain its content rights for longer periods or even “forgo or delay certain content licensing,” which would essentially push windows for online subscription video-on-demand services such as Netflix closer to those for syndication.

SVOD licensing generally brings in less revenue than traditional licensing through cable, satellite and telco operators, Bewkes said, and has no advertising revenue attached.

“We think a lot about how to enhance the value of the traditional pay TV bundle and it’s something we’re obviously looking at [with] our networks,” Bewkes said.

In a note to clients, Sanford Bernstein media analyst Todd Juenger praised Time Warner Inc.’s moves, adding that they won’t be effective unless other programmers follow suit.

“It’s also very important, we think, not to just curtail SVOD licensing,” Juenger wrote. “It’s equally important what you choose to do with the content instead. We think the best answer is: Put it on cable/satellite VOD, as part of the bundle.”

The bundle — thought not too long ago to be the reason for high cable prices by forcing customers to pay for channels they don’t watch — is increasingly becoming the more attractive alternative to over-the-top video offerings like Sling TV, Sony’s PlayStation Vue and others. In a research note, RBC Capital Markets media analyst David Bank wrote that when higher charges for standalone broadband service and limited choices for programming are considered, the cable bundle is still the best value.

“A household could save more money forgoing two bottles of wine in a month rather than replacing traditional cable TV with an OTT-based lighter bundle,” Bank wrote.

While Wlodarczak isn’t convinced that cord-cutting or cord-shaving is easing up, he believes cable will continue to improve its results in the fourth quarter. Charter will add about 30,000 video customers in Q4, he predicted, ending the year on a positive note, while Time Warner Cable and Comcast should be flat and Cablevision will lose about 30,000 over the same timeframe.

“I think it is too early to make the call that cordshaving needs to be rethought,” Wlodarczak said. “I think it is here to stay, but as I have noted in the past, I think it will be likely more contained than most media investors seem to be pricing in — one-to two percentage points of decline driven mostly by the fact that pay TV is increasingly too expensive.”

The turnaround in the cable business hasn’t been a one-quarter phenomenon. The turn in the tide for cable-subscriber losses started four years ago, with Comcast in 2011. Since then, the nation’s largest cable operator has reported basic video-subscriber improvements in 14 of the past 15 consecutive quarters, reducing losses by a staggering 83%.

At the same time, No. 2 U.S. operator Time Warner Cable, after a dark period in 2013, has turned around its operations. TWC reported improved basic video subscriber results in the past six consecutive quarters.

Charter, which reported positive quarterly subscriber growth four times in the past two years — 20,000 in Q1 2012; 18,000 in Q1 2014; 3,000 in Q4 2014; and 12,000 in Q3 of this year — is continuing on that path and, along with TWC, has estimated that it will report positive basic-video customer growth this year.

RIVALS TRENDING DOWNWARD

While cable has shown consistent improvement, telcos and satellite providers have been mired in an opposing trend. Once the main growth engines for the pay TV sector, AT&T and Verizon have seen their TV-subscriber growth dwindle in the past two years.

AT&T added 924,000 U-verse TV customers in 2013 and 680,000 in 2014, but in the first nine months of 2015, that growth has dissipated to a loss of 64,000 customers.

Growth at Verizon — which did not close a megamerger this year — has also slowed down. The telco added 536,000 FiOS TV customers in 2013 and 387,000 in 2014. So far this year, the telco has added 158,000 FiOS TV customers.

On the satellite side, Dish Network — which is scheduled to release third-quarter results on Nov. 9 — has struggled with subscriber losses, shedding 79,000 net subscribers in 2014. In the first half of this year, Dish has lost a total of 215,000 net customers.

All of this seems to bode well for the cable industry.

“Cable’s improvement in basic video looks sustainable,” Moffett wrote.

Time Warner Inc. stock was down as much as 10.4% ($8.03 per share) to $69.27 each in early trading Wednesday after the media giant lowered earnings guidance and said it was considering curbing subscription video on demand windows, triggering a similar fall-off in other stocks in the sector.

 Time Warner stock ralled later in the day to close at $72.20 each, down 6.6% or $5.50 per share. 

AMC Networks fell the hardest, down 6.8% ($5.24 each) to $71.76 per share, followed by Viacom, closing at $47.92 each, down 6.6% ($3.37 per share). Viacom was followed by Scripps Networks INteractive down 2.7% ($1.67 each);  Starz, down 2.6% (90 cents each);  Discovery Communications, down 2.5% (78 cents each); and Disney, down 2% ($2.29 each).

Time Warner lowered its 2015 earnings per share guidance from $6 per share to $5.25 per share, citing the impact of a stronger dollar and  subscriber declines. While Time Warner did not specifically identify the amount of the declines, it said that subscription revenue was down by about 1% in the quarter.

Viacom reported lower earnings for its third quarter as ad revenue at its domestic cable networks continued to fall because of lower ratings.

Net earnings fell 3% to $591 million, or $1.47 a share, from $610 million, or $140 a share, a year ago.

Revenue fell 11% to $3.058 billion. Domestic advertising revenue dropped 9% as ratings declined. Worldwide advertising revenue decreased 2%.

Earnings were even with Wall Street expectations, but revenue was below forecasts.

The results came a day after a big selloff of media stocks because of investor concern that the TV advertising business is weak and distribution revenues are vulnerable.

Operating income for Viacom’s media networks, which include MTV, Nickelodeon and Comedy Central, was down 1% to $1.1 billion. Revenue was up a hair at $2.6 billion.

“Viacom continues to drive change in our business, creating unprecedented levels of original content, forging innovative marketing and distribution partnerships, and prioritizing international growth through organic expansion and strategic investments,” CEO Philippe Dauman said. “Our Media Networks are quickly bringing innovative data-based advertising products to market, broadening our sales capabilities and developing new solutions for marketing partners."

Read more at broadcastingcable.com.