Monday, November 19, 2007

Hong Kong Broadband IPTV Flat

City Telecom added 4 thousand IPTV subscribers to its IPTV service over the last 12 months bringing its total to 120 thousand.

City Telecom's chairman stated that he foresees dramatic changes in the pay TV market in the coming year in Hong Kong. PCCW’s acquisition of the English Premier League football matches and the most popular movie’s broadcasting rights has been a major blow to Cable TV. Many of cable's long-time subscribers would consider changing to other services, one of which is PCCW's, but to pay a higher price than Cable TV, another alternative is not to subscribe any pay TV service at all. In view of this market change, City Telecom is considering an offering that is similar to Cable TV, attracting some of their subscribers to its service.

City Telecom started its IPTV service with a bang and added 100 thousand subscribers in its first year. Its growth has been slow since then. I think that part of the problem has been churn caused by its introductory offer of one year free IPTV service. But I believe that the more serious problem is that City Telecom has not yet come up with a compelling offer that is competitive with both the cable company and PCCW. It appears that the company recognizes this and is going to do something about it.

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