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Cable Technology Feature Article

May 02, 2011

Strategy Analytics: US Cable Operators Losing Customers at a Quick Pace

By Rahul Arora, TMCnet Contributor

Strategy Analytics (News - Alert), in its new report, has highlighted the decreasing faith of video customers in US cable operators. The report, “Winning? Cable’s Charlie Sheen Problem,” shows that over two million video customers have canceled their cable subscription and have instead opted for Telco TV and Satellite in 2010. As a result,  Telco TV and Satellite have more than compensated for cable's losses and netting a modest 273,000 new pay TV subscribers overall.

“Throughout the past seven consecutive quarters of subscriber losses, the inclination of Cable has been to point the finger at various external factors,” said Ben Piper, Director of Strategy Analytics, Multiplay Market Dynamics service, in a statement “Our analysis shows that neither the economy nor the housing market is to blame for these subscriber defections. The problem,” says Piper, “is one of value perception.”

According to the report by Strategy Analytics, the biggest reason behind decreasing number of cable subscribers is low value for money. The report shows that cable subscribers had the lowest perceived value of all pay TV platforms.

 “Much ink has been spilled on the topic of cord cutting,” said Piper, “and even skeptics are now admitting that it can’t be ignored. It’s important to be circumspect, however. We see cord cutting as a more of a ‘check engine light’ than a death knell for Pay TV.”

The report,“Winning? Cable’s Charlie Sheen Problem,” examines the role of macroeconomic factors on subscriber losses, addresses cord cutting and churn issues, and provides imperatives for service providers to stem the customer declines.

Through its surveys, Strategy Analytics provides timely and actionable market intelligence focused on opportunities and disruptive forces in the areas of automotive electronics and entertainment, broadband connected home, mobile and wireless intelligent systems and virtual worlds. Recently, the company came up with a report which said global handset shipments grew 17 percent annually to reach 350 million units in the first quarter of 2011. Apple (News - Alert) captured fourth place in global handset shipments, rising from sixth position a year earlier and leapfrogging rival ZTE (News - Alert).

Rahul Arora is a TMCnet contributor. He has worked as an editor and freelance writer for several reputed organizations in India. To read more of his articles, please visit his columnist page.

Edited by Rich Steeves