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Unedited press release follows:
US IPTV Growth Decelerates in Q4
El Segundo, Calif. (Jan. 31, 2013) — The growth of the U.S. Internet Protocol Television (IPTV) market continued to decelerate in the fourth quarter of 2012, due to the impact of Hurricane Sandy and the slowing expansion of Verizon’s FiOS service.
The two major U.S. IPTV players, Verizon and AT&T, reported a combined gain of 326,000 video subscribers in the fourth quarter, down 19 percent from the 402,000 acquired during the same period in 2011, according to the IHS Screen Digest U.S. Television Intelligence Service at information and analytics provider IHS (NYSE: IHS). This marked the second consecutive year of slowing subscriber growth in the fourth quarter, with the total for the last three months of 2011 down 7 percent from 430,000 in 2010, as presented in the figure attached.
For the entire year of 2012, net subscriber adds for the two U.S. IPTV services amounted to 1.3 million, down 14 percent from 1.5 million in 2011.
Through 2017, both major U.S. IPTV players will continue to see their subscriber gains moderate as the market becomes more mature. By 2017, IHS Screen Digest expects that IPTV in the United States will account for 13.4 million pay-TV households, or 10.8 percent of all pay-TV subscribers.
“Verizon’s FiOS accounted for the majority of the slowdown, as the fiber-to-the-home (FTTH) service added only 134,000 subscribers in the fourth quarter of 2012, down from the 194,000 gained during same period in 2011,” said Erik Brannon, senior analyst for television research at IHS. “The disruption caused by hurricane Sandy may have slowed FiOS’s progress. However, the major reason for the deceleration is that FiOS is largely finished expanding its footprint into new geographic areas of the United States. FiOS’s penetration is significantly higher than that of U-verse, causing long-term growth to slow for Verizon’s IPTV service.”
FiOS slowing—but still growing
FiOS in 2012 increased its video subscriber base by 553,000 to reach 4.7 million, up 13.3 percent from 4.2 million in 2011. This represents a 21 percent reduction from the 701,000 increase in 2011.
FiOS’s video penetration now stands at 33.3 percent, compared to 31.5 percent at the end of 2011. Still, the largest U.S. IPTV provider grew its video subscriber base by 13.3 percent this past year.
The expanding U-verse
AT&T continues to maintain its growth in its U-verse video services, as 192,000 subscribers joined in the fourth quarter of 2012, only 8,000 less than during the same period in 2011.
U-verse video subscribers grew 19.6 percent for the year and now stand at 4.53 million, closing in on FiOS’s total video subscribers. With a much broader rollout of U-verse, the fiber-to-the-node service passes 72 percent more eligible video homes than FiOS. Given a significantly larger reach and low video penetration of just 18.7 percent, AT&T is also able to maintain steady growth in gains for its IPTV services.
All told, U-verse added 745,000 subscribers in 2012, down just 7.3 percent from 2011′s net gain of 804,000 subscribers.
IPTV for everybody
IPTV growth continues in the United States, although at a reduced pace. Plenty of room for expansion remains as FiOS focuses on penetration levels and U-verse stresses marketing to its lightly penetrated footprint.
About IHS (www.ihs.com)
IHS (NYSE: IHS) is the leading source of information, insight and analytics in critical areas that shape today’s business landscape. Businesses and governments in more than 165 countries around the globe rely on the comprehensive content, expert independent analysis and flexible delivery methods of IHS to make high-impact decisions and develop strategies with speed and confidence. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS is committed to sustainable, profitable growth and employs more than 6,000 people in 31 countries around the world.