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AT&T and Verizon to See Double-Digit IPTV Growth

by David Mercer | Oct 22, 2009

In a press release published today, we predict that AT&T and Verizon will post double digit IPTV subscriber growth for the third quarter. Both have seen an impressive growth clip over the past year, and are likewise experiencing increased consumer take up percentages. Consumer take up, clearly, is key here. In a report we released back in September, we talked about drivers and inhibitors to IPTV growth in the US market. One key driver of IPTV uptake is household broadband penetration, which is currently at 63%, and estimated to grow to 81% by 2013. Likewise, household familiarity and comfort levels with bundling will drive uptake-this has certainly been the case in European markets including France, where IPTV was initially "bundled" with broadband as a giveaway. The "content is king" adage continues to hold true, and operators able to secure exclusive premium content will likewise have the upper hand. Satellite provider DirecTV's exclusive "NFL Sunday Ticket" has proven to be an effective churn mitigator and revenue source. Finally, aggressive marketing, such as the print and television campaigns currently underway by AT&T and Verizon, will continue to raise awareness and generate demand among television households. Several factors stand in the way of consumer takeup, however, and these must be overcome if IPTV is to truly take off in the US market. Among these potential inhibitors are "Over the Top" (OTT) content-programming and content available for free or inexpensively online-which to some households will obviate the need for pay television altogether. Customer unfamiliarity is another key hurdle Telcos must overcome; to date Telcos have done an inadequate job in communicating the benefits of IPTV over cable or Satellite. They must make this a priority. Likewise, strong and aggressive competition from cable players, who currently have pipes into 90% + of US homes, must not be overlooked. Twitter: twitter.com/DavidMercer_SA Client Reading: US IPTV Market Sizing: 15.5 Million Subscribers by 2013 Add to Technorati Favorites
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