The IPTV segment to grow strongest among the three video-providers, with a 7.2% CAGR predicted in the US through 2015
Total US pay-TV video subscriptions in the second quarter declined to 100.6 million, down from 101 million in the first quarter, according to new IHS Screen Digest U.S. Cable Networks Intelligence research.
Despite the decline, the second quarter actually was a strong period for the US pay-TV business, with revenue-generating units (RGU) for cable rising robustly due to the expanding broadband and telephony segments, IHS said.
The number of US households subscribing to pay television video voip services declined by a total of nearly 370,000 in the second quarter, affecting cable operators.
However, total cable RGUs, or individual service subscriber contracts, actually rose by 238,000 on the strength of increased subscriptions for non-video voip services.
The second-quarter decline comes after a 13,000 increase in video subscribers that occurred in the fourth quarter of 2010 and a 477,000 gain during the first quarter of this year.
While significant declines in video subscriptions are taking the US cable operators toll, cable companies are recouping their losses by signing up high-speed data (HSD) and voice-over-Internet-protocol (VOIP) service subscribers at a faster rate than they are losing video subscribers.
US cable operators posted gains of 270,000 broadband subscribers and 593,000 VOIP services subscribers, which more than offset the loss of 625,000 video subscribers, and left 59.3 million households still subscribing to cable video services.
IHS expects that in a worst-case scenario where cable loses 10% of its video subscriber base by 2015, operators will maintain noteworthy operating margins due to their cash-flow-rich HSD and VOIP services.
The US satellite video sector also saw the flight of some 109,000 subscribers during the second quarter, bringing the total down to 33.5 million.
DirecTV undoubtedly has been successful at capturing the high end of the market with its sports packages, while DISH Network has built its business on the back of cost-conscious consumers, the report said.
IPTV is the only sector to post video-subscriber gains in the second quarter due to the strong performances of its biggest two players, Verizon FiOS and AT&T U-verse, whose combined US subscriber reached 7.9 million, a net addition of 366,000.
The report the IPTV segment is in the strongest position among the three video-providers going forward, with IHS predicting a 7.2% compound annual growth rate in the US through 2015.
All data here includes subscribers in three areas of the pay-TV video business: cable, satellite video and IPTV services provided by telcos.
