The Federal Communications Commission (FCC) in the US has issued its annual state of competition report for the video market, noting that a number of pro-consumer choice trends at work in the market are paying off.
The commission cited continued deployment of digital technology, sustained consumer demand for access to video programming anywhere and anytime, an increased number of households with access to at least four video providers as telephone companies extend their video systems, and an increased number of online video providers who are entering the market as well as developing original content.
"When you step back from the blizzard of facts and figures, the report's principal lesson is simple – and profound. Today, more Americans have more choices when it comes to video programming than ever before," commissioner Ajit Pai said.
The number of multichannel video programming distributors (MVPDs) active in the US market now includes 1,141 cable MSOs, two satellite players (DirecTV and DISH Network), two large IPTV operators (AT&T and Verizon) and "many smaller telephone MVPDs," or regional telcos offering IPTV. Across all of them, subscribers grew from 100.8 million to 101.0 million households between year-end 2010 and June 2012.
Cable, however, continues to struggle. Cable's share of MVPD subscribers fell from
59.3% of all MVPD video subscribers at the end of 2011 to 55.7% at the end of June
That's great news for satellite and telcos, which gained both video subscribers and market share. Satellite accounted for 33.1% of all MVPD subscribers in 2010, increasing to 33.6% at the end of June 2012. Telcos represented approximately 6.9% of all MVPD subscribers in 2010, increasing to an estimated 8.4% in 2011.
At the end of June 2012, AT&T's U-verse and Verizon's FiOS services combined had 8.6 million video subscribers.
Since the last report, the number of households relying exclusively on over-the-air broadcast service has remained steady at approximately 11.1 million households, although the percentage of all households they represent increased slightly from 9.6% in 2011 to 9.7% in 2012.
And while the online video industry is still evolving, streamers like Netflix continue to expand the amount of video content available to consumers through original programming and new licensing agreements with traditional content creators, the FCC noted.
Viewing of over-the-top (OTT) video programming on television sets is becoming increasingly prevalent too. Americans view 40 minutes of Internet video each week. The commission cited SNL Kagan, which estimated by the end of 2012 the number of Internet-connected television households (i.e., accessed via an Internet-enabled game console, set-top box, connected TV or Blu-ray player) grew to 41.6 million, or one-third (35.4%) of all television households.
OTT is providing additional viewing options for most Americans except those in underserved broadband markets. "Nearly three out of ten rural Americans do not have access to high speed Internet that is sufficient to receive online video distributors' services," said acting chairwoman Mignon Clyburn. She said her hope is "that these consumers are not forgotten as these services become more popular and offer more extensive programming."