Cable industry executives and stakeholders expect an increase in the number of partnerships and mergers between MSO's and content providers, as well as MSO's and telephony companies over the next three years, according to a survey among cable and telecom industry professionals conducted in February by Tri-State Technology, Media and Telecommunications practice at Deloitte and Touche.
"The cable television industry is at a crossroads, driven by two forces, convergence of distribution and content and consumer choice made possible by broadband and digital technology," said Peggy Smyth, managing partner of the Tri-State TMT practice. "The future course of the industry will be determined by which of these two forces dominates."
The survey also gauged the effects of pending FCC media ownership rules, the balance of power between content providers and distributors and the potential importance of iTV programming and content on the cable industry over the next three years. The findings concluded that:
* 46 percent of respondents anticipate convergence of some form would be "extremely" or "very likely" to occur between MSO's and content providers as opposed to 35 percent for MSO's and telephony operators;
* Consumers are more interested in pricing models that put control of purchasing and selecting channels and services in their hands, including on-demand channel purchases, specific program purchases and operator-defined bundles;
* The extent to which the FCC will relax ownership rules is still up for debate.
Survey respondents classified themselves as content providers (32 percent), software providers (6 percent) telecommunications operators (three percent), network technicians (two percent), MSO's (two percent) and Other (55 percent). Interviews were conducted with 129 cable stakeholders, defined as executives, operators, programmers, financial/industry analysts and academics.
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