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Cable Congress: The numbers – Cash up, digital up, total TV subs down

The European cable industry reported that it was up 6% in revenues terms from a year ago to reach €18

By PETER WHITE

Published: 17 February, 2011

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The European cable industry reported that it was up 6% in revenues terms from a year ago to reach €18.8 billion and said that the drift to digital, vital if the industry is going to meet deadlines to switch off analog in 2012, is still strong, with 17.4% more TV homes taking digital cable instead of analog across Europe, and digital TV revenues up 23.3% to €5.74 billion, now making up 58% of total TV revenues within cable.

These figures come from numbers compiled by IHS Screen Digest on behalf of Cable Europe, which organized the Cable Congress in Lucerne Switzerland this week. Broadband revenue is up 4% and telephony up 9% in revenues, but both were up 11% in connection numbers, with Broadband now reaching 23 million homes, up from 20.1 million and VoIP telephony over cable now reaching 18 million, up from 16 million.

But among all these figures Faultline pointed out that surely the drop in the number of total cable homes, or total TV homes, must be worrying. Manuel Kohnstamm, president of Cable Europe came back with a snappy answer, “When cable first set up in Europe it was taking 70% and 80% of pay TV homes. As new technologies have launched it was bound to settle down a little and this is not a big deal, and as analog cable shifts to digital there will be a few more desertions, but this year it has just been 200,000 homes.” He then cited IHS Screen Digest at over 61.1 million homes this time last year and 60.9 million today.

This is a little disingenuous, who’s going to say they’re wrong? Well as usual at Faultline we’re prepared to. In Germany last year up until to the third quarter, in the Rethink-TV database for Europe, we can see that some 375,000 cable homes were lost, while at Numericable alone in France, 200,000 more went. In Holland across Ziggo and UPC, there was a fall of 140,000 cable TV homes. Another 80,000 went across Romania and even where the Cable Congress was held in Switzerland, UPC lost 17,000 cable homes. That little lot adds up to over 800,000 of losses, and we can’t accept that the smaller, tough to count, cable companies added enough to replace this, or that the stronger cable territories, usually areas of high growth for other forms of pay TV like Central Europe, added enough to make up the difference either. We just flat don’t choose to believe it because publicly available figures show it’s likely to be wrong.

There will be some reason for this, perhaps homes which are new to taking only broadband, but which don’t take pay TV from cable companies, allows Screen Digest to say that less companies have actually left the fold, but the truth is that the current rate of cable desertions are far from being “no big deal,” and we think Cable Europe has to be a bit more up front about that, and not constantly paint a nice face on an industry which we know is tough.

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