Thursday, December 08, 2005
Cable Penetration Hits 13-Year Low
In the latest PR move made by the Television Advertising Bureau (TVB) they are blitzing the ad agency community with the message that more American households are receiving subscription TV programming (TVB’s lingo for Cable TV) via an alternate delivery system (ADS) than ever before. MSOs lost 1.4 million subscribers and wired cable's penetration percentage hit a 13-year low, according to a TVB analysis of Nielsen Media Research data for November 2005.
Nielsen’s NTI data reflects national ADS penetration to have reached 20.8% in November 2005, up from 19.2% in November 2004. Over the same period, wired cable penetration fell from 66.4% to 64.8% - the last time wired cable was any lower was in February 1992. The number of wired cable subscribers dropped to 71.4 million in November from 72.8 million a year earlier.
Direct broadcast satellite (DBS) delivery, the largest component of ADS, is now estimated at 20.2%, up from 18.9% in November 2004. ADS now represent 24.5% of subscription television customers. As a 20-year veteran of the Cable industry, this is certainly not surprising. This is the first small bit of red witnessed by an industry that has been blessed by decades of double-digit growth. What is important is make moves now to integrate this tend into the industries future business model. Satellite penetration will continue to chip away but the biggest threat looms in new distribution technology. As the telcos gain footing and begin to offer more TV services over wireless, phone lines, fiber. ADS penetration will grow at a rockets pace. Although cable Interconnects consolidated DMA’s and helped advertisers make cable a part of their media mix in the first decade of the century. I expect the waters to be murkier in the not too distant future. The MSO’s may not be allowed to own and operate alternate distribution systems but that doesn’t stop their ad sales companies from representing them and keeping “Cable” simple and easy to purchase by advertisers and agencies alike.
Review ADS penetration by DMA
To read more from the TVB Click here.