Cable industry increasingly being seen as more than TV business, CCTA survey

As Canadians rapidly adopt new technological gadgets, the cable industry contends that its role is to develop into "advanced media" companies to stay relevant. "We see our competition, not coming primarily from satellite (TV distribution) but from competition to the digital home," says Canadian Cable Television Association (CCTA) president and CEO Michael Hennessy. "You are really looking at all these things to use the content that travels over telephone, cell phones and all the devices and bundling all that together to the home. Ultimately, if cable is not perceived as an ‘advanced media’ company, we’re in trouble…You will start to see cable become more of a portal for local news, weather and information. Our community channels and what we’re doing online will start to merge much more. Because remember, it’s the same platform, the same plug into the home. It’s just being plugged into different devices." Some survey resultsThe percentage of cable and satellite TV subscribers with Internet connections rose from 28% in 1998 to 70% in 2004. The percentage of respondents indicating the Internet in their homes is connected to various gadgets was: CD burner (33%)a digital camera (28%),a TV set (17%)a DVD burner (12%)an MP3 player (10%)a stereo (9%)a personal planner like a Palm pilot or blackberry (8%)a cellular phone (8%),multiple TV sets (5%). The CCTA’s view of the future sees all kinds of entertainment gadgets and new technologies interconnecting. For example, television will not only be delivered through cable but also through the Internet onto computer screens, and a home theatre could be set up with the stereo hooked to the TV and computer. A survey conducted on behalf of the CCTA by the Strategic Council reveals that Canadians are already embracing new entertainment products that could lead to such an outcome. The second annual study found that the percentage of cable households with digital cable service rose from 10% in 2000 to 25% in 2004. One-quarter of the respondents used their PCs to watch video, 4% said they currently had a personal video recorder (PVR), with 37% stating they were interested in acquiring one. Consumers are not only ready to embrace PVRs but also online video-on-demand, high-speed Internet access and Voice over Internet Protocol (VoIP) as an option for local telephone service, according to the survey, unveiled July 13 to government bureaucrats. "Where you see differences (in this year’s survey from last year’s) is in the adoption of the technologies. You really do see growth. If you look at DVD players, you’ve got a 15% increase in reported acquisition of those. I think what you really see year over year is very rapid adoption of some technology," Strategic Council president Chris Kelly tells Canadian Communications Reports. "The other area where you see some differences is in some of the attitudinal data where views are becoming more entrenched so that you have higher portions of people agreeing that the Internet is more and more critical to their household. So as you see the acquisition of the technology application, you get a parallel hardening in attitude." Overwhelmingly, respondents describe their household Internet connections as important. About 83% indicated that their Internet connection was "very important" or "somewhat important," according to the survey. The CCTA view places convergence back at the forefront. "Convergence isn’t dead. I think people thought convergence was dead because many businesses made so many bad investments. The technology didn’t die but a lot of the CFOs did," says Hennessy. He sees no limits to the technologies that cable companies can deliver from IP-based telephony services to video-on-demand. "I don’t think there is a limit on how content and communications are all going to start moving to IP packet networks. And because of that I think there is a multitude of services that we will be able to provide down the road," he notes. "If the networks get smarter, then more and more things can be on demand and more and more can be segmented." Hennessy says the cable industry is well placed to deliver the converged entertainment world to consumers - a perception that Canadians tend to agree with, according to the survey. When probed on the types of firms that are most likely to fit the description of "advanced media" companies, cable companies emerge at the top of the list, notes the study. About 45% of respondents identified cable generally or a specific cable company as an "advanced media" company, while 35% identified telcos or a specific telephone company. The data comes from a nationwide proportionate telephone survey of 1,200 Canadians, 15 years of age and older, that was conducted between February 17 and February 27 this year. All respondents included in the survey had cable or satellite service in their home. The survey size provides results with a margin of error of plus/minus 2.8 percentage points, 19 times out of 20.

Cable industry increasingly being seen as more than TV business, CCTA survey

Broadcast | July 30, 2004

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