Per-subscriber IPTV VOD revenue soars past cable

Michelle Clancy | 05-03-2013

In 2012 over three-quarters of all transactional video-on-demand (VOD) movies were rented via cable and satellite TV services; however, IPTV operators grew their share of the VOD movie rental market by 4% and earned more than twice the amount of movie rental revenue per subscriber.
According to The NPD Group, in 2012 cable TV operators continued to control more than half (56%) of the overall $1.3 billion operator transactional VOD movie market, followed by satellite TV operators (27%) and telecom operators (18%). Telco TV operators, including Verizon FiOS and AT&T U-verse, grew their rental share four percentage points during this period.
At the same time, cable operators' share declined four percentage points, and satellite operators' share increased one percentage point.
"Verizon FiOS and AT&T U-verse still considerably lag cable operators in the number of service subscribers; however they are actually growing their share of the multichannel video distributor VOD movie rental market," said Russ Crupnick, senior vice president of industry analysis for NPD. "Telecom operators are leading their competitors when it comes to earning additional revenue from VOD movie rentals."
Although Comcast and other cable TV operators enjoy a tremendous lead in the overall number of subscribers, Verizon FiOS and AT&T U-verse also generated more annual VOD movie rental revenue per subscriber. NPD estimates that in 2012 telcos earned average per-subscriber VOD revenue of $25.29, cable TV operators garnered $13.83 per subscriber, and DIRECTV and DISH Network netted an average of just $10.33.