[opendtv] Re: That pesky HDTV niche market
- From: BenWebber@xxxxxxx
- To: opendtv@xxxxxxxxxxxxx
- Date: Thu, 29 Apr 2004 18:22:46 -0400
John Golitsis wrote:
> virtually all new digital cable customers are
> going with HDTV service.
I believe this is an unwarranted assumption. The Comcast first quarter
earnings announcement doesn't actually say that. It does say:
"We added 192,000 new digital subscribers ..."
Elsewhere, it also says:
"During the first quarter, 176,000 subscribers signed up for Comcast's
HDTV service to finish the quarter with 469,000 HDTV customers, a 60%
increase from the fourth quarter of 2003."
Nowhere does it say that the new HDTV customers were _also_ new digital
subs. It's likely that many of the folks signing up for HDTV were
already digital subscribers.
Down in the fine print we also find useful information for those
interested in the bigger (business) picture:
Comcast video services are now available to 40 million U.S. homes. Of
those homes, 21.5 million subscribe to basic video services. Of those
21.5 million basic subs, 7.9 million also subscribe to the digital tier.
Of those 7.9 million digital subs, 469,000 also take HDTV.
The bottom line is that around 2.2% of Comcast video subscribers take
HDTV. You can call it a premium market segment (that's really the
correct term) if you don't like the term "niche".
The current quarterly growth rate in HDTV takeup is very impressive, but
it's not going to stay at 60% for too long. HDTV will be taken up quite
rapidly by (relatively affluent) digital subscribers, and MUCH MORE
SLOWLY by the far more numerous (and less affluent) universe of basic
subs.
The biggest challenge for cable operators (and the biggest driver of
profits) is still in coaxing subscribers from basic to digital in the
first place. There's no question that HDTV helps with this, but at this
point it's icing on the cake. (And the DVR rollout will help Comcast
even more, IMHO.)
Regards,
B.
--------------------------------------
Ben Webber benwebber@xxxxxxx
1414 W Byron St 1W 773-935-2112 (v)
Chicago, IL 60613 773-935-8961 (f)
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