Sector Snap: Paid television

The recession continued to push pay TV customers into lower-cost subscriptions during the second quarter, but the end of analog TV signals in June helped cable and satellite providers add customers, according to a report from Deutsche Bank.

Checks with customer service reps, retailers and installation workers showed bargain hunting among existing and prospective customers, Deutsche Bank Doug Mitchelson said in a note to investors Tuesday.

But he said there was also an uptick in calls from "over-the-air" viewers getting ready for the digital transition, possibly helping net subscriber additions in June.

Mitchelson also noted that "promotions did not get more aggressive during the quarter," which is likely to help prop up average revenue per customer.

He said Dish Network Corp.'s $9.99-per-month promotion has been "ineffective" in competing with DirecTV Group Inc.

At Comcast Corp., "there is a distinct sense that growth is challenged, but not at unexpected levels," he said.

Mitchelson said that Time Warner Cable Inc., which was spun off from Time Warner Inc. in March, "has been disciplined in its promotional offerings and retention discounting" despite "price shopping by consumers."

Subscriber "growth remains stable" for Cablevision Systems Corp., he said.