Electrical Business

News
Statistics are in for cable and satellite television


December 14, 2009
By Bruce Homan

The operating revenue of cable and satellite television companies totalled $10.3 billion in 2008, up 14.4% from 2007. It was the industry’s third consecutive year of revenue growth in excess of 10%.

These numbers are for the year ending August 31, 2008 and, as such, do
not reflect the impact the economic slowdown had on the cable and
satellite television industry.

According to StatsCan, wireless service providers, especially satellite providers, had a
profit margin of 4.1% before interest and taxes, compared with 25.9%
for cable operators. It was a positive result for the second
consecutive year for the wireless segment, which posted losses before
interest and taxes between its emergence in 1997 and 2006.

The cable industry’s profit margin before interest and taxes has been
above 15% every year since the beginning of the decade and higher than
20% since 2004. The diversification of the segment’s services, that
began with the introduction of internet access services more than 10
years ago and expanded to include telephone services in 2005, has
helped improve its profitability. On August 31, 2008, cable operators
had almost as many telecommunications subscribers (internet and
telephone) as television subscribers.

Cable distributors had 15.7 million subscribers to their primary
services (television, internet access and telephony) on August 31,
2008, 1.4 million more than in 2007. More than half of the new
customers were telephone service subscribers, says Statistics Canada.

For a second consecutive year, cable television subscriptions grew
faster than subscriptions to competing wireless services (+2.3%
compared with +1.5%). Over the previous 10 years, wireless service
providers had always succeeded in increasing their market share.

On August 31, 2008, there were 2.7 million wireless television (mainly
satellite) subscribers, compared with 8.1 million cable television
subscribers.