While the news media preoccupies itself with the battle of titans, telecoms versus cablecoms for pay-TV market share, satellite delivered direct-to-home service has been quietly and steadily gaining on them both.
According to TeleGeography’s CommsUpdate, the DTH pay-TV sector now claims 150 million subscribers with a growth of 13% to 15% per year. This growth trend continues even though there is a recession and the intense marketing and bundle deals offered by the telecom and cable companies.
Despite the enthusiasm for the potential of Internet Protocol television, including such well known favorites as YouTube, Hulu or the streaming version of Netflix, the reality is that the population of DTH is 5 times that of IPTV. At the same time, the subscriber growth rate of DTH is double that of cable TV.
As if growth is not enough, globally DTH enjoys average revenue per user that is double that of the telecom and cablecom companies. Though ARPU numbers are closer in North America, the gulf in most countries is large when comparing ARPU for pay-TV offered over DTH as opposed to other platforms.
It seems a losing proposition, while telecoms and cablecoms battle over the triple-play bundles of Internet, phone and television access, DTH offers one service, television. This may be proof of the axiom of doing one thing and doing it well.
If DTH continues to drain the profit that is television out of the telco/cable bundles they will become unstable and fall apart as proven service offerings. More turbulence and bifurcation of the market is sure to follow.
Originally published in the Swiss online newspaper, www.zitig.ch, reedited for WholeThinking.
