June 14, 2006 Dallas, TX -- While cable companies remain the favored provider of stand-alone pay-TV services, telephone companies top the list when it comes to a triple-play package of pay-TV, telephone, and high-speed Internet service. According to Receptivity to TelcoTV among Pay-TV Subscribers - Primary Research and Analysis, a new report from The Diffusion Group, 33% of US pay-TV subscribers would prefer to receive triple-play services from their local telephone company, compared to 29% who favor the cable company, and 30% than have no preference at all.
"There are sufficient numbers of ambivalent or dissatisfied cable and DBS subscribers that a competitive telco triple-play offering even slight cost advantages could be disruptive to the market balance," said Dale Gilliam III, an analyst with The Diffusion Group. "This is good news to telcos looking to offer their own video services and triple-play packages."
"What is most interesting about this new data is not only that telcos topped cable in triple-play preference, but that another one-third of Pay-TV subscribers could care less which company provided their video, Internet, and telephone services," said Michael Greeson, CEO of The Diffusion Group and co-author of the report. "Loyalty to current pay-TV service providers is unlikely to be much of a barrier for telcos entering the pay-TV and triple-play space."
Greeson posits that this is due in part to the sustained competitive presence of DBS providers who have already shaken consumer loyalty among cable subscribers such that new market entrants don't have to focus as much energy and resources on dislodging existing customers -- this is great news for telcos set on offering video services.
TDG's report features the results of an April 2006 study of more than 1,500 US pay-TV households regarding interest in TV and bundled services offered from their "local telephone provider." Central to the report is an analysis of how interest fluctuates relative to different levels of monthly cost savings, a variable which weighs heavily upon interest in telco TV offerings.