FCC releases report on competition in the U.S. video programming delivery market

Friday, July 19th, 2013 
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FCC Adopts 15th Report On The Status Of Competition In The Market For The Delivery Of Video Programming

WASHINGTON, D.C. — The Federal Communications Commission (FCC) today adopted its 15th Report to Congress on the status of competition in the market for the delivery of video programming. The Report, which covers 2011 and 2012, measures the market’s progress toward increasing competition and diversity in multichannel video programming distribution, increasing the availability of satellite delivered programming, and spurring the development of communications technologies.

The 15th Report adopts the analytic framework of the 14th Report. Under this framework, the Commission categorizes entities that deliver programming into one of three groups: multichannel video programming distributors (MVPDs), broadcast television stations, and online video distributors (OVDs). The Report describes each group’s structure, business strategies and performance. It also addresses video content creators, consumer behavior, and consumer equipment.

The trends found since the 14th Report show continued deployment of digital technology, sustained consumer demand for access to video programming anywhere and anytime, an increased number of households with access to four MVPDs 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.

Specifically, the Commission found that, among other things:

  • The number of MVPD subscribers grew from 100.8 million to 101.0 million households between year-end 2010 and June 2012. During this period, cable’s share of MVPD subscribers fell from 59.3 percent of all MVPD video subscribers at the end of 2011 to 55.7 percent at the end of June 2012.
  • Between year-end 2010 and June 2012, Direct Broadcast Satellite (DBS) MVPDs and telephone MVPDs gained both video subscribers and market share.
    • DBS MVPDs accounted for 33.1 percent of all MVPD subscribers in 2010, increasing to 33.6 percent at the end of June 2012.
    • Telephone MVPDs represented approximately 6.9 percent of all MVPD subscribers in 2010, increasing to an estimated 8.4 percent 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 percent in 2011 to 9.7 percent in 2012.
  • While the OVD industry is still evolving, OVDs continue to expand the amount of video content available to consumers through original programming and new licensing agreements with traditional content creators.
  • Viewing of OVDs’ video programming on television sets is becoming increasingly prevalent. For example, one source, SNL Kagan, estimated by the end of 2012 the number of Internet-connected television households (i.e., accessed via an Internet-enabled game console, OVD set-top box, television set, or Blu-ray player) would have grown to 41.6 million, or 35.4 percent of all television households.

MVPD Video Subscribers (in millions)

                                                      End of
                   ------------------------------------------
                   Year 2010  June 2011  Year 2011  June 2012
                   ---------  ---------  ---------  ---------
MVPD Total             100.8        N/A      101.0        N/A
Cable                   59.8       58.9       58.0       57.3
 Comcast                22.8       22.5       22.3       22.1
 Time Warner Cable      12.4       12.2       12.1       12.5
 Cox                     4.9        4.8        4.8        4.7
 Charter                 4.5        4.4        4.3        4.3
 Cablevision             3.3        3.3        3.3        3.3
 All Other Cable        11.9       11.6       11.3       10.5
DBS                     33.4       33.5       33.9       34.0
 DIRECTV                19.2       19.4       19.9       19.9
 DISH Network           14.1       14.1       14.0       14.1
Telephone                6.9        N/A        8.5        N/A
 AT&T U-verse            3.0        3.4        3.8        4.1
 Verizon FiOS            3.5        3.8        4.2        4.5
 All Other Telephone     0.4        N/A        0.5        N/A

Sources: SNL Kagan and company reports