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Kagan Research Projects Satellite Subscribers to Reach 33.5-M by 2015 |
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MONTEREY, Calif., Sept. 29, 2006/Satnews Daily/ — A new study from Kagan Research estimates that DBS’s current share of 29 percent is nearing steady state in terms of the multichannel market. As telcos come online with their video products the effect is expected to be similar to that of the last ten years, with the new platform driving deeper multichannel penetration and expanding the market.
The primary effect, however, will be to further diminish cable’s share to 61 percent while increasing multichannel homes by nearly 20 million.
Kagan expects solid subscriber growth from DBS in the near term, waning a few years out as local-into-local and HD local penetration matures. At the end of the 10-year horizon, Kagan projects satellite will notch more than six million net new subscribers to total more than 33.5 million by 2015.
“Despite the lack of a competitive solution to the return path issue, DBS will continue to be a major player in the multichannel market through its established base and strategy of targeting underserved markets such as rural areas and international communities,” said senior vice president Derek Baine. “In addition, new technologies are making features such as VOD and interactive, once the sole domain of cable, available via satellite and narrowing the competitive divide. And with the launch of new satellites, DBS operators will have more capacity to offer more high definition channels in the near term than their counterparts.”
Other key findings and projections from “The State of DBS (8th Ed) include:
· In 2005, subscriber additions to DBS declined 29 percent from the previous year as the satcasters were hit with higher churn and increasing competition. The start of 2006 continued the trend with Q1 net adds down 50 percent year-over-year at DirecTV and 31 percent at EchoStar. Full year results are expected to be 1.8 million net additions, 22 percent below 2005 totals.
· The multichannel pie has expanded significantly over the past decade, growing 38 percent from 68 million at end-1995 to 93.8 million at end-2005 (before netting out cable/DBS duplicates). But DBS’s addition of nearly 25 million subscribers over the last ten years has shrunk cable’s share of the market by more than 20 points
· Short term, DBS has lots of capacity coming online and an advantage in beaming national channels. Telcos have only 20-25 Mbps for video, data and phone, limiting them to just one HD stream, and cable is already nearing capacity at recently upgraded plants.
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