Cable Co Profit Margin Analysis: Pay-TV vs. Broadband
As Pay-TV subscribers and margins continue to dwindle, Cable Broadband profitability is growing. Our analysis shows that HSI margins are anywhere from 70% to 110% higher than Pay-TV — depending on whether or not advertising is included in the calculation.
Broadband is likewise changing the face of the traditional Cable bundle. In 2008, Video contributed 59% to Cable’s Revenues. In 2010, the number was 53%.
While on the surface it may seem like a no-brainer, doubling down on broadband may not be the best long-term strategy for Cable. As a highly commoditized consumer offering, it is extraordinarily challenging to differentiate, and is one easily duplicated by competitors.
Flipboard
Transmedia Newswire 