Feature: Cable Tipped To Regain Momentum Despite Dip In TV Share
Cable’s position as the platform of choice for the broadband revolution has never been in doubt. Offering bundled telephony and TV services it is ideally placed as the system through which television, internet, interactive and telephonic services can be delivered.
But roll-out of cable networks has stalled while satellite continues its domination of the emerging markets. During 2000 satellite TV uptake was up 28.2%, while cable TV’s share of the total pay-tv market declined by approximately 5 percentage points and now stands at 37.5%.
A recent worldwide study from Strategy Analytics confirms satellite as the preferred platform for new customers; 65% of all new digital customers chose a satellite-delivered service during 2000, compared to just 31% who opted for cable.
The remaining customers subscribed to digital terrestrial platforms, which in the UK saw the highest growth during 2000. Uptake at ONdigital, now renamed ITV Digital, grew by 83.3% during 2000 although it still trails behind cable in terms of subscribers, at just over 1m compared to cable TV subscriptions, which passed the 3.5m mark last year.
It has been speculated that the ONdigital revamp will leave cable companies in a bad position. The marriage of content and delivery at both ITV Digital and Sky are now way ahead of that of the two major cable companies, which are in danger of becoming little more than delivery methods.
Yet cable networks are still tipped to be at the forefront of the digital revolution and this week’s mooted content deal between NTL and media giant AOL brought the possibilities of broadband into the spotlight again.
Paul Hodges, CEO of Europe-based internet broadcasting company Virtue Broadcasting, said that he viewed the possible deal as “a great endorsement of broadband in Europe, to have the biggest content provider in the world looking to enter the market.” He added that he hoped such a deal would provide a wake-up call to European content providers.
Such a deal would certainly shake up the UK pay-tv market, giving NTL the power to compete head on with BSkyB. Strategy Analytics believe 2001 will be the year when cable regains momentum, predicting that it will account for 40% of new digital subscriptions worldwide, compared to 55% for satellite. This is in line with Merrill Lynch forecasts which show Sky still at the front in 2008 with 7.3m subscribers followed by cable at six million and digital terrestrial at 3m.