NEW STUDY SHOWS SATELLITE TV GROWTH COMING AT THE EXPENSE OF CABLE
--Consumer Take Rates For Local Channels Via Satellite Nearing 50%--
Alexandria, VA, June 28, 2000 - The Satellite Broadcasting and Communications Association (SBCA) and The Yankee Group today released some highlights from the 3rd Annual 2000 Direct Broadcast Satellite (DBS) Study showing the burgeoning popularity of satellite TV versus other subscriber-based video content providers. Among its many findings, the study shows: DBS is making enormous in-roads in cabled areas; satellite delivery of local stations is hugely popular with consumers; DBS customers are likely to recommend satellite TV to a friend; and DBS subscribers are valuable high-end customers.
DBS Making In-Roads In Cabled Areas
Of new DBS subscribers (less than three months of service), 70% have cable available to their household. This figure is up from 60% last year. Of all DBS subscribers, 60% hail from areas where cable is offered.
"Clearly, these figures show that a growing number of our new subscribers have the choice of cable, and are choosing to go with satellite TV," said SBCA Senior Vice President Patricia Andrews. "What was once considered a product for only those homes and businesses in more rural areas, is now becoming increasingly mainstream in urban and suburban markets." Satellite Delivery Of Local Stations Popular With Consumers
The 2000 DBS Study shows that 46% of all DBS households and 56% of new DBS households reported that local stations are available via their satellite provider. Of that, 20% of overall DBS households and 26% of new DBS subscribers reported receiving their local stations via satellite. For both existing and new DBS customers, this represents a local channel take rate nearing 50%.
"We saw a net new subscriber increase in the first quarter of 2000 of 860,000 customers, and the availability of local channels via DBS was a tremendous catalyst to that growth," added Andrews. "As consumers become more aware of local channel availability and the platform providers continue to roll-out local service in new communities, we expect local channel take rates to climb even higher." DBS Customers Likely To Recommend Satellite TV To A Friend
Of current DBS subscribers, 76% said they were very or somewhat likely to recommend their satellite TV service to a friend. Of new DBS subscribers, 80% indicated they were very or somewhat likely to recommend their satellite TV service to a friend. And of new subscribers who receive their local broadcast channels via satellite, 86% said they were very or somewhat likely to recommend their satellite TV service to a friend.
"Although you can never stop striving to improve public perception, the DBS industry is clearly head and shoulders above other subscriber-based video content providers with respect to customer satisfaction," stated Andrews.
DBS Subscribers Are Valuable High-End Customers
The 2000 DBS Study shows that 62% of new DBS households subscribe to a premium service and 63% receive two or more premium services. In addition, the study finds that 54% of new DBS households have ordered a pay-per-view movie or event.
"These figures show that new subscribers to satellite TV are the most coveted type of customer because they tend to purchase additional programming beyond the basic packages," Andrews said. "This illustrates that the consumer places value on the premium content being offered, and bodes well for the industry's continued growth."
"These numbers are very encouraging, but this is not a time for complacency," said SBCA President Chuck Hewitt. "As we roll out a whole new generation of interactive products and services, the importance of providing unparalleled customer service will continue to grow. Serving the needs of our customers will remain a paramount goal of our industry."
According to the chair of SkyTRENDS Market Research Committee and Vice President of Research, MTV Networks, David Charmatz, "This year's study once again shows the value of research in this industry, and proves that listening to consumers yields quick dividends. Consumers continue to respond positively to having increased entertainment options presented to them at a fair price."
"This is the third year we have done this study and we continue to see very interesting trends in the use and adoption of DBS," said Bruce Leichtman,Vice President of Media and Internet, The Yankee Group. "With both cable and DBS upgrading their systems to offer new products and features, the competitive environment continues to evolve. These improvements ultimately benefit the consumer."
SkyTRENDS is the market research, data collection and reporting program for the satellite industry. This program is a venture between Media Business Corp and the SBCA.
The Yankee Group is an internationally recognized leader in technology research and strategic consulting, whose broad-reaching analysis encompasses all areas essential to e-business success: the Internet, electronic commerce, communications, wireless/mobile, computing, and enterprise applications. The Yankee Group specializes in assisting companies with their e-business, enterprise networking, and Internet technology and electronic market initiatives while maintaining synergy with their overall business strategies. The Yankee Group continue to distinguish itself by providing personalized one-to-one analysis and planning assistance to its customers.
The Satellite Broadcasting and Communications Association of America (SBCA) is the national trade organization representing all segments of the satellite industry. It is committed to expanding the utilization of satellite technology for the broadcast delivery of video, data and voice services. The SBCA is composed of DBS and other satellite service providers, programmers, equipment manufacturers, distributors, retailers, encryption vendors, and national and regional distribution companies.