Pay TV Providers Benefit from DTV Transition

07.13.2009

NEW YORK: Cable, satellite and telcoTV providers will net around 653,000 new subscribers because of the digital transition. Wachovia analysts had previously expected the uptake to reach around 900,000.

Before the June 12 DTV transition, around 18.3 million households were thought to be entirely reliant on over-the-air reception. The majority obtained digital receivers of some type to adapt. Around 2 million had let it slide in the weeks after the transition.

Cable is expected to score most of the broadcast refugees, adding 475,000 new subscribers formerly using an antenna. Direct broadcast satellite providers should see around 137,000; and telcos, 41,000. Wachovia said the pay providers likely saw the greatest gains during the first quarter. Comcast took in 90,000; Time Warner Cable, 80,000; DirecTV, 47,000; Dish, 35,000; and Cablevision, 50,000.

“We believe cable will see more of an impact from the transition in Q3 versus Q2… given that fewer households converted to pay TV as a result of the transition than we had originally anticipated; that cable operators perform their quarterly sub counts one to two weeks prior to quarter end; and recent management comments regarding the difficult economic environment--which likely offset subscriber gains from the digital transition,” the analysts wrote.

Consequently, 2Q estimates for Comcast, Time Warner and Cablevision were reduced, but slightly increased for Q3. -- Deborah D. McAdams