Cable TV Faces Customer Satisfaction Issues

Video-on-demand may be cable's best bet for improving customer satisfaction with services

Cable television could see a mass migration away from its services, according to Parks Associates' TV 2.0: The Consumer Perspective, if providers do not improve their consistently low satisfaction ratings among subscribers.

This new report reveals that subscribers to satellite television and telco/IPTV are significantly more likely to be satisfied with their services than both basic and digital cable subscribers. These market conditions leave cable carriers vulnerable to subscriber churn, and the survey recommends they quickly enhance advanced services like video -on -demand (VoD) to reverse this trend.

"Cable subscribers are generally less satisfied, which creates opportunities for satellite and telco/IPTV providers to grab customers," said Kurt Scherf, vice president, principal analyst, Parks Associates. "Although cable operators have improved service efforts, cable operators will still hemorrhage subscribers unless they are perceived as offering leading -edge features at equal or better value. In today's economic climate, carriers cannot afford to ignore these findings."

Cable operators have struggled in selling the value of their services, Scherf said, and framing their services as an enhanced and convenient form of entertainment will be critical in reestablishing higher satisfaction. VoD initiatives, particularly those aimed at delivering a "Primetime, Anytime" experience, should be key elements in this effort.

"Subscribers who actively use primetime VoD services show significantly higher satisfaction levels," Scherf said. "Primetime VoD offerings are potential ARPU generators and trigger churn toward the provider, a reversal of current market trends."

TV 2.0: The Consumer Perspective is a survey of more than 2,700 U.S. and 1,000 Canadian adults in households with broadband Internet access. Key sections of this study:

- Consumer electronics use habits, with a specific focus on how Media Center PCs, TiVo set -top boxes, and game consoles are used to receive Internet video content
- Consumer interest in new video -centric products, such as Apple TV, VUDU, and the Slingbox
- Tracking changes in video consumption habits, focusing primarily on television and movie content
- Internet video consumption, including popular genres, locations for Internet video viewing, and payment
- Cable, satellite, and telco/IPTV pay -per -view and video -on -demand use and interest in video -on -demand features
- Satisfaction with current television provider
- Consumer interest in, willingness to pay, and potential churn trigger of 21 enhanced television features

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About Parks Associates

Parks Associates is an internationally recognized market research and consulting company specializing in emerging consumer technology products and services. Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start -ups through market reports, primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.

The company's expertise includes new media, digital entertainment and gaming, home networks, Internet and television services, digital health, mobile applications and services, consumer electronics, and home control systems and security.

Each year, Parks Associates hosts executive thought leadership conferences CONNECTIONS™, with support from the Consumer Electronics Association (CEA®), and CONNECTIONS™ Europe. In addition, Parks Associates produces the online publication Industry Insights in conjunction with the CONNECTIONS™ Conference series. | | |

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