SOURCE: Pike & Fischer

January 08, 2008 14:04 ET

Cable Companies to Concentrate More on Selling Household Savings in 2008, According to New Market Forecast

SILVER SPRING, MD--(Marketwire - January 8, 2008) - As the nation's economic slump continues well into 2008, cable operators will modify their marketing strategies to place more emphasis on household savings rather than cool new features, according to a new forecast by Pike & Fischer.

This change in strategy will occur as U.S. households worry about the dwindling value of their homes and scale back spending on such items as home entertainment, P&F predicts in a new forecast of broadband competition in 2008.

Cable operators, for example, will start offering economy tiers of high-speed Internet service for cost-conscious consumers who are satisfied with less bandwidth than what standard cable service delivers and who might otherwise buy lower-priced digital subscriber line (DSL) service, P&F says in a new report.

But cable operators are also likely to see their base of digital phone subscribers grow as more and more consumers drop traditional telephone services for cable's monthly flat-rate plans and discounts, the Silver Spring, Md.-based market research firm anticipates.

Top cable operators will lose about 200,000 basic video subscribers in 2008, but will more than offset that with the addition of 4.5 million new telephone customers and 4.6 million new high-speed Internet subscribers, P&F predicts.

"But cable companies will also have to increase their spending on bandwidth enhancement efforts to offer more high-definition video and faster Internet speeds," notes Scott Sleek, P&F's Director of Broadband Advisory Services. "They need to compete with the super-fast Internet speeds being delivered by telephone companies over fiber-optic lines, and the expanding menu of HD channels coming from the satellite TV providers."

Pike & Fischer, a BNA company, offers a host of legal and business products covering the telecommunications industry. These forecasts are included in a new report, "Broadband Competition Outlook 2008," priced at $629 and available for purchase at www.broadbandadvisoryservices.com. For analyst commentary or to request a briefing, contact Scott Sleek at 301-562-1530, x291, ssleek@pf.com

For information about Pike & Fischer's Broadband Advisory Services, visit www.broadbandadvisoryservices.com or contact Jonathan Wentworth Ping at 212-576-8741, jping@pf.com.

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