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Jupiter: Digital Won’t Drive Cable Growth

8/31/2004 7:24 AM Eastern

Saying that cable customers might not find video-on-demand and digital-video recorders to be indispensable, analyst firm JupiterResearch said Tuesday that it has scaled back its digital-cable-penetration forecast and upped its forecast of satellite-TV growth.

Jupiter estimates 26 million digital-cable households in 2004, about 35% of cable households, rising to 43 million digital-cable homes (57% cable penetration) in 2009. The firm didn’t say how much it had scaled that forecast back. Jupiter pointed out that cable operators report churn or disconnect rates are higher for digital cable than for analog cable.

The market research firm — watching high net growth rates for satellite providers DirecTV and Dish Network so far this year — upped its digital satellite forecast for 2004 by 7%, to 24.3 million.

In other analysis, Jupiter expects 8% of digital-cable customers to be taking DVR service this year, about 2.2 million households. It sees cable’s DVR home ranks rising rapidly (a 62% annual clip), to reach 24 million, or 57% digital-cable penetration, in 2009.

Still, Jupiter said surveys have shown less interest in DVRs among cable customers than among satellite customers, and opined that “for MSOs to exceed DVR penetration estimates, they will have to aggressively campaign to ensure consumers view DVRs as integral to their viewing experience.”

Jupiter figures 66% of satellite-TV customers will be equipped with DVRs in 2009, as satellite providers aggressively market the technology.

Cable households should grow to 75 million households in 2009 from 73 million this year.

 

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