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Friday, January 27, 2012

Get set for shakeup in big TV packages, Cogeco says | FP Tech Desk | Excerpt via Financial Post

By Jamie Sturgeon Jan 26, 2012 – 6:47 PM ET

"...The challenge the $8.1-billion industry must master is in creating the right mix of product and price to protect the comfortable margins the old model has produced.

“What’s going to happen is that everyone, every distributor, will gradually move to smaller-sized packages,” Louis Audet, chief executive of Cogeco Cable Inc., said Thursday on a first-quarter earnings call. “The art will be in pricing and offering these packages in such a way that we maintain or enhance our revenue.”

Erosion in the existing model doesn’t appear imminent. Montreal-based Cogeco, the fourth-largest cable provider in the country, reported better-than-expected subscriber additions to its premium digital television service while also posting gains in basic cable. Indeed, asked by one analyst whether the company saw any downsizing of packages by customers who may be augmenting television viewing by going online — called “cord-shaving” as opposed to “cord-cutting” — Mr. Audet said no. “We don’t see that right now.”
But trends are undoubtedly changing. Rate increases have hummed along for the past decade, up another 6% to an average $59.73/month in 2010, according to the latest data from the Canadian Radio-television and Telecommunications Commission. Consumers have begun seeking refuge, some through regulatory complaints others via new Web alternatives...."

Posted via email from Siobhan O'Flynn's 1001 Tales

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