Monday, October 27, 2008

Verizon Q3 Strong, Now 7th-Biggest U.S. Cable TV Provider

In just a couple of years, Verizon has grown from a start-up cable operator to the 7th largest MSO in the United States. That is quite a meteoric rise and their quarterly growth indicates that they are looking to overtake 6th place within the next few years. Unlike satellite providers, Verizon offers consumers the first real competitive choice for cable, internet, and phone. Where the cable landscape emulated the wild west only a decade or so ago, acquisition and consolidation has turned cable from a land of many to a land of few. Former cable companies, Adelphia, Century, TCI, Lenfest, and others were once part of that world.

Now, the top 10 list looks like this:
1. Comcast Cable - 24.5 M Basic Video Customers
2. Time Warner Cable - 13.3 M
3. Cox Communications - 5.4 M
4. Charter - 5.2 M
5. Cablevision - 3.1 M
6. Bright House Networks - 2.3M
7. VERIZON - 1.6 M
8. Mediacom - 1.3 M
9. Suddenlink Communications - 1.3M
10. CableOne - .7 M

It is easy to see that the list size drops precipitously and that size matters. Verizon has grown by being the true overbuilder across these other cable companies. AT&T, as the other telco has seen less growth but is currently at .5 M and expects to reach 1.0 M at the end of the year, which would then rank them at the 10th spot, pushing out CableOne.

Cable companies have been seeing growth of basics despite this competition. Is this because the telco companies are taking the low hanging, least desirable customers first, or is it more customers switching from Dish or Direct TV. Either way, as the telcos grow their footprint across the cable landscape, this list may change as a result of downward shifts to the cable company while the telco numbers soar. Perhaps more cable consolidation is in order to survive the telco or be eaten!

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