IP Democracy: Telcos Are Going Gangbusters on Video

With all the excitement that web-delivered video generates, the vast majority of people still watch plain old multichannel TV. And the most interesting development in the plain-old-TV-service world is that the phone companies are doing a remarkable job at giving cable operators a run for their money.

Based on the Q3 07 numbers for the top four U.S.-based telcos, the phone companies continued to accelerate their video gains during the past quarter, although not quite as strongly as you might expect. During the quarter, the four telcos combined added 576,000 video customers, up from the 300,000 net new video customers gained during the year-ago quarter and up by 10,000 over Q2 07 levels.

The big gainer was, of course, Verizon, which added a net 202,000 FiOS TV customers during the quarter, ending Q3 07 with 717,000 of the fiber-based video customers, representing 15% of all homes capable of buying FiOS TV.

Even though AT&T and Verizon posted big gains from their FTTx initiatives, all the telcos continued to gain ground through their DBS partnerships -- AT&T added 140,000 net new DBS video customers during the quarter while Verizon gained 85,000 new DirecTV-affiliated customers. No wonder, then, that AT&T is rumored to be in the midst of buying EchoStar's Dish Network.

Unfortunately for the cable industry, there are few signs that this telco video growth will cool anytime soon. AT&T and Verizon continue to steadily expand their fiber-based video footprints and add bells and whistles that make telco TV attractive. Just today, Verizon announced it plans to expand the number of HD channels it offers up to 150 in 2008.

Posted by Cynthia Brumfield on November 1, 2007 6:33 PM to IP Democracy