In the first half of 2009 cable companies around the world generated over USD30 billon in telecoms service revenues, primarily from broadband internet and telephony services. The sales were derived from a customer base that includes 82 million broadband internet subscribers and 49 million telephony subscribers. The revenue figure may seem relatively small compared to a global wireline services market of well over USD700 billion per year, but cablecos’ telecoms revenues have grown 28% per annum since 2003, while the aggregate wireline market has grown at just 4% annually.
While cablecos are not yet able to compete directly with telcos in many countries, TeleGeography’s new research shows that they now account for 29% of broadband subscribers and 9% of telephony subscribers in markets where they are licensed to compete. This equates to approximately 15% of residential telecoms revenues in those countries, a figure which continues to grow apace.
While cable companies’ success in the telecoms arena is predominantly a feature of North America and Western Europe, this is changing. TeleGeography projects that cablecos in Eastern European and Latin America will gain significant market share in the coming years. Cablecos in the Asia-Pacific region will play a more limited role, however. While both China and India have huge cable TV markets, cablecos there are excluded from offering telecoms services, and this is unlikely to change any time soon.
‘IPTV has been getting huge amounts of attention over the past three years and this has tended to blind people to the impact cablecos are having on the telecoms market’, said TeleGeography’s John Dinsdale. ‘Traditional telcos have been losing substantial market share while leading cablecos have succeeded in transforming their businesses to the point where almost 40% of their revenues now come from telecoms. Comcast, Time Warner Cable and Liberty Global all now feature in the top 15 ranking of broadband internet service providers, and telecoms remains an engine for growth for many cablecos around the world,’ added Dinsdale.
This week there has been a flurry of third quarter earnings announcements from cablecos which confirm these trends. Even in the highly competitive and mature markets of North America and Western Europe, the leading cablecos have grown their telecoms revenue by almost 10% relative to the third quarter of 2008. Despite the added pressure of a deep recession, these leading cablecos have seen their broadband internet subscriber bases grow by 7% and their telephony subscriber bases by 13% over the last twelve months.
TeleGeography’s GlobalComms Insight provides detailed subscriber and market forecasts for over 160 countries and is a companion to the GlobalComms Database, a regularly updated online database of wireline, wireless and broadband competition. No other telecoms market research service rivals their collective geographic scope and depth of coverage.