Skip to main content

Cable MSOs Broaden Revenue Diversification


Cable TV's penetration rate is expected to erode ever so slightly in the next decade -- as the telcos join satellite TV in a dog fight for basic subscribers -- but Kagan Research believes that cable MSOs will still prosper. Cable is adding new revenue streams that will keep it a healthy growth business.

Kagan estimates cable residential revenue -- forecast to be $68.2 billion in 2006 -- will reach $120 billion by 2016. That doesn't include additional revenue from business customers. The gains are expected despite penetration for cable TV video services as a percentage of all residential TV households slipping slightly from 58.6 percent this year.

Cable telephony and high-speed cable modems get the most attention among add-on cable services. But the list is much longer: digital video recorders, high definition channels, video on demand and interactive TV.

"Cable thrived despite stiff competition from satellite TV for a decade," notes Robin Flynn, senior analyst with Kagan Research. "Now telcos have arrived too, but cable is bulked up and remains well positioned. Competition increases, but so does the revenue pie with these additional services."

Ms. Flynn predicts that average revenue per (cable subscriber) unit including all services is expected to climb from $87.04 per month in 2006 to well over $140 by 2016. I believe that this assessment is very optimistic. I'm guessing that she has not taken into consideration any losses associated with the continued growth of over-the-top video distribution services.

Moreover, armed with an IPTV service that closely follows the legacy programming model of the incumbent pay-TV providers, the telcos will have little choice but to ignite a new round of price wars -- in order to attract and retain subscribers beyond the first wave of early adopters. Again, this is not a 'business as usual' scenario.

Popular posts from this blog

Industrial and Manufacturing Technology Growth

In an evolving era of rapid advancement, market demand for innovative technology in the industrial and manufacturing sectors is skyrocketing. Leaders are recognizing the immense potential of digital transformation and are driving initiatives to integrate technologies into their business operations.  These initiatives aim to enhance efficiency, reduce costs, and ultimately drive growth and competitiveness in an increasingly digital business upward trajectory. The industrial and manufacturing sectors have been the backbone of the Global Networked Economy, contributing $16 trillion in value in 2021. Industrial and Manufacturing Tech Market Development   This growth represents a 20 percent increase from 2020, highlighting the resilience and adaptability of these sectors in the face of unprecedented challenges, according to the latest worldwide market study by ABI Research . The five largest manufacturing verticals -- automotive, computer and electronic, primary metal, food, and machinery -

Rise of AI-Enabled Smart Traffic Management

The demand for smart traffic management systems has grown due to rising urban populations and increasing vehicle ownership. With more people and cars concentrated in cities, problems like traffic congestion, air pollution, and greenhouse gas emissions are pressing issues. Since the early 2000s, government leaders have been exploring ways to leverage advances in IoT connectivity, sensors, artificial intelligence (AI), and data analytics to address these transportation challenges. The concept of a Smart City emerged in the 2010s, with smart mobility and intelligent traffic management as key components.  Smart Traffic Management Market Development Concerns about continued climate change, as well as cost savings from improved traffic flow, have further motivated local government investment in these advanced systems. According to the latest worldwide market study by Juniper Research, they found that by 2028, smart traffic management investment will be up by 75 percent from a 2023 figure of

How Generative AI Will Reshape the Economy

The Global Networked Economy -- a term synonymous with the interconnectedness of businesses, individuals, and governments worldwide -- has undergone a remarkable transformation in 2023. Fueled by the rapid growth of digital technologies and the global internet, this phenomenon has given rise to a worldwide marketplace that has already revolutionized the way we live, work, and play. The impact of Generative Artificial Intelligence (GenAI) in 2024 will be equally disruptive to many traditional business leaders. GenAI will also create huge opportunities for the fearless pioneers. Global Networked Economy Market Development The Global Networked Economy's evolution traces back to the advent of the Public Internet. The introduction of eCommerce, social media, and cloud computing has been instrumental in reshaping how businesses operate and engage with their customers. This interconnected ecosystem empowers savvy leaders to access new markets, trim operational costs, enhance commercial e