Impressions of Cable Congress 2012

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    Cable Congress provided some useful insights, as always, into the current state of the cable industry, its future prospects and cable operator strategies looking ahead. Here are a few key themes we picked up at the Brussels event last week.

    The OTT big bad wolf – we’re just not scared
    The cable industry is not worried about OTT. For starters, cable operators win when people need higher speed broadband, but just as importantly the threat of cord cutting has not materialised. There was more talk at this show about partnering with online content providers if they have something additional to add, and treating them like any other content aggregator. The bottom line is that the European cable industry is confident it will remain the primary aggregator of entertainment content in the home.

    Multi-screen monetization – it’s still about loyalty
    There is consensus that multi-screen TV is a must-have for Pay TV operators. It boosts customer satisfaction and therefore loyalty. Panel moderators made various attempts to explore new and discrete revenue streams that might arise from viewing on tablets and smartphones, etc, and there are hopes that companies can acquire new subscribers, upsell to higher priced packages and make it easier to consume more transactional content. One moderator asked why, when consumers say they will happily pay for this service, most companies are giving it away today. In all discussions, the chief justification always came back to loyalty: keeping hold of the customers you have. We know that several operators hope that multi-screen viewing will be habit forming and people will eventually pay more for the privilege.

    The big question now is how to maintain growth
    After a roaring decade for European cable, driven by its success in broadband acquisitions and triple-play bundling, the worry now is how to maintain growth. On one panel the question was asked: is cable still viewed by investors as growth stock or a way to make safe and steady returns? According to one analyst (as we report elsewhere), the big opportunity for increasing ARPU is now video again, with half of European cable subscribers yet to go digital. There was more discussion about future revenue and ARPU growth this year than for many but this should not distract from the strong position cable has got itself into. This is a problem created by success.

    Being successful brings its own problems – be vigilant
    Telcos have been losing out to cable when it comes to broadband and need fibre roll-outs to keep pace. There is a view that the cable industry has a window of opportunity now to enjoy the fruits of its high-speed broadband investments before telcos catch up, and they even have time to take a breather at 50Mbps and consider just how fast they need to go, according to Mike Fries, President & CEO at Liberty Global. But he expressed fears that regulators/politicians could start sympathising with telcos so made the point that when it comes to broadband, this still a case of David vs Goliath.

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