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Digital Cable Growth is a Catalyst to VOD and (eventually) IPTV Growth

Filed in archive IPTV on March 29, 2005

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When TiVo introduced their Digital Video Recorder (DVR) back in 2000, a new line was drawn which I will call MyTV.

On one side of that line are all the people who watch broadcast or cable television on the network's schedule. That is, the viewer watches what is aired when the network schedules it. In industry parlance, that is 'linear television.'

On the other side of the line are the DVR owners, VOD viewers, and (coming up in status) IPTV. What is common across this group is that they tend to watch television when they want and (sometimes) even what they want to watch. This is due to the fact that video content does not have to be aired on a network schedule, so more choices are possible. This is the essence of television on-demand, or MyTV.

In today's Wall Street Journal, there was an article about the slowing of Satellite TV subscriptions. In it, it quantified their competitor: cable.

"The report forecasts that cable companies will ... close out 2005 with 68 million [television subscribers]. Cable companies are expected to gain 3.3 million digital subscribers during the year, finishing up 2005 with 29.3 million."

So, almost 30 million household will be able to at watch cable's version of video on demand (or, VOD). That is a pretty sizable community and is larger than all the Satellite subscribers added together.

It will be interesting to see whether these VOD households begin to change the television industry. Catering to their needs is in Comcast and Time Warner's interests. As the service grows, it can form the basis of tomorrow's service expectation. My bet is that they will.

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