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I just read David Mercer's blog called "Europe’s TV Viewers Cut the Cord: Free TV Alive And Well" on Strategy Analytics blog.
I wrote a comment on their site, then suddenly the comment feature disappeared.
After reading the European Commission’s latest household communications survey, David draws a bleak picture. European's all over the continent are saying how they are leaving cable-TV for digital terrestrial which is still making big inroads throughout Europe. Read his interesting piece here.
What I wrote as a comment was that maybe cable operators will end up leaner and meaner once they shed all those subscribers that only watched FTA on their service.
ARPU should go up and customer call centers can deliver better service and/or reduce costs.
The survey doesn't say if cable are losing their triple play or high ARPU customers which would really hurt the business.
I know that in France at least, PayTV via DTT has all but flopped.
Joe Bloggs, or Madame Michu as she's called here, considers that DTT is for free TV, Cable and Satellite for pay TV and IPTV is somewhere in between.
YouView's potential success will be more of a real test for the likes of Britain's cableco Virgin or satellite platform Sky, because the DTT platform Freeview is already prevalent in the UK. A successful YouView with monetized OTT, would constitute really scary cord cutting for pay-TV execs.
I agree with David that the landscape is changing, but maybe not as fast as he implies.
I'm sure Strategy Analytics could match some operator subscriber numbers with this declarative survey to add some credibility.
Hi Ben
sorry for the problems with the SA website – trying to get those resolved.
I’m not sure if I was trying to draw any particular picture beyond what the EC numbers show: that 4% fewer European homes were using cable at the end of 2009 compared to a year earlier. Clearly there is variability across 27 nations. I referenced Benelux in particular where the decline was much more significant. I think most people would agree 4% across the entire EU is a huge shift within 12 months.
Your argument about preferred customers is something the US cable industry has also talked about for many years. Maybe they simply don’t want customers who don’t spend much money. That’s fine as long as you are making the strategy clear to investors, who still tend to look at the total customer base as a key indicator. Rising ARPUs should be a good thing, but if your customer base is disappearing they may not help grow overall revenues.
David