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Telco Firms May Not See Big Growth In Video

Oct 23, 2006  •  Post A Comment

Telecommunications companies such as Verizon and AT&T will snag less than 5 percent of the video market by 2011, according to a new report from JupiterResearch.

Despite their aggressive marketing campaigns and lobbying efforts, the telcos’ video offerings will reach only about 5 million homes in five years, the report said.

But they’re stuck between a rock and a hard place: With the voice business a mature one-and with cable operators encroaching into that business-telcos have no choice but to get into the video business.

“Since the phone companies are publicly traded companies, they are under pressure to deliver increased earnings. In addition, they are facing competition on the voice front from the cablers themselves,” said Todd Chanko, the lead analyst behind the JupiterResearch report.

The report also found that penetration of digital video recorders will reach 34 percent of homes and 54 percent of digital homes by 2011. The good news for cable operators is that the number of homes receiving cable DVR service will grow by 51 percent.