So far in the third quarter, both Comcast and Time Warner (News - Alert) Cable have reported video subscriber losses. That in itself would not be unusual, given a market share shift in favor of telcos and satellite providers as of late, but is likely to convince some observers that "video cord cutting" is happening. That isn't necessarily the most logical explanation or conclusion.

Comcast (News - Alert) earlier reported a loss of 275,000 subscribers in the third quarter, while Time Warner Cable said it lost 155,000 video subscribers, representing a collective loss of 430,000 subscribers.

Both Verizon and AT&T (News - Alert), on the other hand, gained 200,000 or more subscribers each. In other words, telco gains roughly mirrored cable operator losses. 

Verizon's FiOS TV service had an increase of 204,000 net new subscribers, while AT&T's U-Verse had an increase of 236,000 new video subscribers. That represents a gain of 440,000 subscribers. In other words, it is not possible to attribute a decline in Comcast and Time Warner Cable video subs to "video cord cutting." It seems more logical to attribute the cable losses to market share shifts to telco and satellite providers.

In fact, DirecTV added 174,000 new U.S video customers as well. Dish Network hasn't reported, yet. One way of looking at matters is that Comcast and Time Warner Cable, the two giants of cable, essentially traded share to Verizon (News - Alert) and AT&T. 

DirecTV's gains then might be said to represent a shift of share from other cable providers, and possibly some share from rival satellite provider Dish Network as well, should Dish Network report a customer decline rather than net growth. In the second quarter of 2010, Dish Network reported losing 19,000 net subscribers. 

Assuming Dish Network reports third quarter results at the same level, the other U.S. cable operators could lose 155,000 customers without necessarily triggering any conclusion that the overall U.S. multichannel video service market actually is shrinking. 

Further, even if the multichannel video market should experience a second consecutive quarter of subscriber decline, it still might not necessarily mean that customers are substituting online video viewing for subscriptions. With the backdrop of the sluggish U.S. economy, most customers might be temporarily suspending service, planning to sign up again when conditions improve. 

Still, that could lead to years of trouble, and could lead to a definitive shift to online video if the content providers decide to shift more support to online delivery. 

Some 13 percent of current multichannel video subscribers in the United States say they are "somewhat" or "very" likely to cancel their current subscription in the next 12 months, and not sign up with a competing provider, according to a survey of 2,000 U.S. households recently conducted by Strategy Analytics (News - Alert).

So far, though, what we have seen seems largely to be a case of market share shifts between contestants, rather than a wholesale move to cord cutting. The other complication is that given moribund new housing starts, some amount of household consolidation and a sour economy, many consumers might be making temporary decisions to suspend purchases, without necessarily indicating a permanent shift in behavior. 

Cord cutting is a threat, to be sure. What isn't clear is whether it is a major problem at this time, nor is it clear whether such cord cutting is merely tactical and temporary, or represents a permanent change of behavior.