Video cord proving hard to cut

Telco TV subscriber figures are not the only indicator of how TV service providers are making their way through a harsh economy, but the TV subscriber numbers from the two largest telcos in the U.S. are showing virtually no ill effects at all. Verizon Communications and AT&T each added nearly 300,000 TV customers during the first quarter of this year.

Is their progress a sign that TV services are recession-proof, as some have suggested? Some months ago when that possibility was put forth, the logic seemed pretty questionable: If people are concerned about losing their jobs and their life-savings, and about the prospect of not being able to pay their mortgages, cable TV/telco TV/satellite TV seemed like it should be one of the first things that gets cut. Instead, service provider numbers have hinted that the video cord-cutting threat has yet to develop into anything real.

While cable TV providers may be the ones feeling ill effects of telco TV success-AT&T said 60 percent of its TV subscribers were taken from cable TV companies-even cable TV firms seem to be doing reasonably well keeping their existing customers tied into premium services. Parks Associates recently said that about 37 percent cable TV customers in the U.S. still use premium video-on-demand offerings on a regular basis, which is 16 percent more than did so five years ago.

We'll find out more about the overall health of the TV services market as cable TV firms report their own first quarter numbers, but for now, TV services do not appear to be taking a commercial break during the down economy.

-Dan

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