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Cable Pay-TV Upside Now Limited to Fewer Markets

During the ongoing global recession and an increasingly competitive telecommunications environment, cable's triple-play of video, voice, and high-speed data services continues to attract new subscribers.

However, while worldwide growth in cable pay-TV video subscribers has been impressive, the North American and European growth has essentially halted -- those market are saturated and are already in a decline.

The majority of new cable TV subscribers will come from China (with low-cost services, when compared to the saturated markets), which will be the primary market that drives worldwide cable TV subscribers to over 500 million by 2014, according to the latest market study by In-Stat.

Meanwhile, the Latin America market is showing strong growth across all three of the triple-play components of the video, modem, and telephony service bundle.

"In the past, most cable TV operators viewed themselves simply as video service providers," says Mike Paxton, Principal Analyst at In-Stat. "But as the competition for pay-TV services evolved, cable's triple-play became an important tool to hold on to video customers, while up-selling additional services."

Today, in many mature cable TV markets, cable telephony and broadband cable modem subscribers are providing some revenue growth while cable pay-TV video subscribers are either experiencing no growth or lower demand is decreasing revenue.

In-Stat's latest market study reveals the following:

- Latin America will have over 4 times as many cable telephony subscribers in 2014 as compared to 2009.

- On a worldwide basis, cable TV subscriber households increased by 3 percent between October 2009 and September 2010. During that same twelve month period, cable modem cable telephony service subscribers grew by low double-digit percentages.

- Between October 2009 and September 2010, China added approximately 15 million new subscriber households.

- A combination of economic stress and cutthroat competition from satellite TV, telco TV and low-cost OTT service providers has driven down total U.S. cable pay-TV subscriber households by over 1 million in the past year.

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