03/23/98 article: Initial Digital Results Please Cable Operators
By LINDA HAUGSTED
full article and data: multichannel.com
Los Angeles -- Cable operators were cautiously pleased by the initial results of their digital-tier rollouts, saying that penetration has reached 5 percent to 13 percent in less than a year.
Operators presented their findings here last week at the CTAM Digital and Pay-Per-View Conference.
For example, Cox Communications Inc., which launched digital five months ago in Aliso Viejo, Calif., in its Orange County cluster, said 7 percent of its 15,000 customers there have taken the new tier...
...Surveys are showing that subscribers have displayed a high level of sophistication about their knowledge of digital, and Cox is leveraging off community knowledge of the Digital Satellite System to boost penetration, Elander said.
"The majority know [about DSS], so we're playing off that. Our ads say, 'Digital TV without the dish.' They respond to more choice, more convenience and digital quality," she said...
"...But the most impressive launch numbers came from little Buford Television Inc., in its Heath, Texas, Friendship Cable system. After six months, the system has topped 13 percent digital penetration, with 130 customers, said Ron Martin, Buford's president and chief operating officer.
Of the 130 Buford digital subscribers, 86 percent opted for the all-inclusive package at $69.95 per month. Of those customers, 10 percent were four-pay homes, 50 percent three-pay homes, 25 percent one-pays and 15 percent basic only.
While Martin noted that the package price wasn't much of a jump for multipay households, basic-only subscribers were used to paying $28 per month, and they bypassed $12.95 and $15.95 tier options.
...Price points are very elastic, Jayne said. Interest remained in the 50 percent to 60 percent range even when consumers were asked if they'd pay $9.99 per month, as opposed to $3 or $4.
French said TCI is still wrestling with marketing strategy.
TCI has tried giving away boxes or offering two months' free service, he noted. "When we've done that, we're seeing a big bump," French said... |
