With US broadband customers set to rise to the same level as pay-TV subscriptions in 2016, the American cable and satellite businesses have reached a critical point where their continued growth will hinge on the success of their new TV Everywhere services, according to the IHS Screen Digest service at information and analytics provider IHS.
“Based on our continuing analysis of TV Everywhere and OTT services like Netflix, it’s clear that the US pay-TV industry has reached a historic juncture,” IHS director and principal analyst Tom Adams says. “Neither print nor audio media have been able to properly capitalise on—or even just withstand—the Internet juggernaut. So, the key question for US pay-TV operators in the years ahead is: Will TV Everywhere keep customers coming to them, rather than to their OTT competitors, for video entertainment?”
The challenge for traditional cable and satellite operators is the mounting penetration of broadband among US consumers, which is rising to rival the level of pay-TV US broadband connections will expand to 99.9 million in 2016. This compares to 100.4 million for all cable, satellite and telco pay-TV subscribers during the same year.
“The growing ubiquity of broadband connections has leveled the playing field between OTT Internet-based video services and pay-TV operators,” Adams explained. “So now the battle is joined in the contest to provide consumers with the most attractive package of content, applications and devices for their in-home and on-the-go enjoyment.”
“The battle between pay-TV and OTT will be the key media competition of the decade ahead, just as the battle between the open Internet and proprietary services like AOL defined the mid-90s,” Adams added. “The Internet is now fully video-enabled. Do pay-TV operators have the right stuff with TV Everywhere to remain the dominant players in delivering video entertainment in the digital age? That’s what we’ll assess at CES this year.”