Multichannel Market Shrinks For First Time: SNL Kagan8/23/2010 12:02 PM Eastern
The combined multichannel video marketplace declined for the first time in history in the second quarter, according to an SNL Kagan study.
Subscriber gains by cable competitors were offset by historic subscriber losses in the cable sector resulting in a net loss of 216,000 subs in the multichannel marketplace as a whole compared with a gain of 378,000 in the second quarter of 2009.
Cable was down a combined 711,000 subs, said Kagan, with six of eight MSOs recording their worst losses ever. By contrast, DBS added a combined 81,000 subs and telcos 414,000.
Cable's combined share of the market was down to 61% from 63.6% in the second quarter of 2009. Telcos now claim 6% of the video market, up from 4.3% in that prior-year period, according to Kagan.
Although competition clearly played a part in the historic drops, Kagan attributed some of the decline to a weak housing market and high unemployment.
While the numbers are painful to cable's bottom line, they arguably help cable's case in Washington that the marketplace is competitive and that the industry hardly has a corner on the multichannel marketplace that could be used to justify regulations some operators see as putting a thumb on the scale for DBS providers (program access rules) or broadcasters (must-carry).