Digital TV subs rise 10% in 2011; IPTV to double share of market by 2017: Report

TV subscriptions continued to rise last year with 11.8 million Canadian households paying for an analog or digital TV service at the end of 2011, up 2.6 per cent from the 11.5 million who subscribed in 2010, Ottawa-based consulting firm Boon Dog Professional Services said in a report released Monday. Digital and analog TV subscriptions in Canada, including cable, satellite, or IPTV services, rose “despite an increasing number of Internet-based alternatives available to consumers, such as Netflix,” a Boon Dog release said. “The shut down of analog over-the-air TV transmission, population growth, and the emergence of strong IPTV competitors all contributed to the increase in traditional TV subscriptions in 2011,” Mario Mota, Boon Dog co-founder and partner, said in a statement. More than 10 million Canadians subscribed to a digital TV distribution service at the end of 2011, Boon Dog said. Its report, part of the firm's Canadian Digital TV Market Monitor series, said the number of digital TV subscription households in 2011 increased by 10 per cent, or more than 890,000, to reach a total of more than 10 million. Growth in digital subscriptions in 2010 was also 10 per cent, or more than 850,000, Boon Dog said. The firm said 85 per cent of Canadian TV subscription households had digital, as opposed to analog services at the end of 2011, which was up from 79 per cent a year earlier. “The percentage of TV subscription households receiving traditional analog cable reached an all-time low of 15% as many cable companies push to migrate their remaining analog customers to their digital offerings,” Mota said. As of Dec. 31, 2011, cable had a 63 per cent share of digital TV households, followed by satellite at 29 per cent, and IPTV at 9 per cent, Boon Dog said. A year earlier, cable had a 62 per cent share, satellite 31 per cent, and IPTV 6 per cent. Boon Dog predicted that IPTV’s share of the digital TV market will nearly double to about 17 per cent by the end of 2014 at the expense of satellite and cable subscriptions. Rogers Communications Inc. said in a first-quarter financial statement last week that it lost 21,000 cable TV subscribers during the first quarter of 2012, largely due to competition with fibre-based IPTV services offered by competitor BCE Inc. Rogers CEO Nadir Mohamed told investors that the company is now on a “two-year journey” to convert its television distribution technology to an IPTV network, which provide more end-user control and lead to cost efficiencies for the company over the long term. Dvai Ghose, a research analyst with Canaccord Genuity, said in an interview that the 10 per cent annual rise in digital TV subscribers is mostly due to a migration of customers from analog. Overall TV subscriptions continue to rise by about two-to-three per cent per year, he said, despite the availability of free, over-the-air digital TV signals since Canada's conversion from analog to digital local broadcasting last year. “Unlike cord cutting on the phone side, where the total number of phone customers has gone down in Canada, the total number of video customers has gone up,” Ghose said. He said increased competition from online sources has created a “potential reduction” in the amount that consumers are willing to spend on monthly TV bills, noting that subscriptions for premium specialty channels like the Movie Network (owned by Astral Media Inc.) and Movie Central (owned by Corus Entertainment Inc.) are declining. Ghose added that Telus Communications Co.'s IPTV service is also drawing subscribers from Shaw Communications Inc.'s cable TV service in the West. “The telcos are getting significant market share, which a lot of people didn't think they would get,” he said. Boon Dog estimated that, at the end of 2011, 52 per cent of all digital TV subscribing households (representing more than 5.1 million), had a high-definition set-top box for HDTV programming. As of Dec. 31, 2011, an estimated 69 per cent of all households with digital TV subscriptions (representing more than 6.8 million) had access to video-on-demand services through their cable or IPTV service provider, Boon Dog said. news@thewirereport.ca

Digital TV subs rise 10% in 2011; IPTV to double share of market by 2017: Report

News | 04/30/2012 7:34 pm EDT

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