Pay TV needs a differentiator

The market-leading telcos and cablecos reported solid first quarters for the year, despite the economic recession, the threat of cord-cutting, the competitive landscape and a host of other reasons that might've otherwise hindered them. Positive earnings in a competitive environment, however, don't mean these companies can sit still. The TV landscape is changing, and the pay-TV provider — cableco or telco — that adapts will be the one that pulls ahead.  

TWC added 36,000 basic video subscribers and 121,000 digital video subscribers in Q1 —  numbers that Craig Moffett, senior analyst for Bernstein Research, called extremely encouraging and reassuring. While Comcast lost 78,022 basic video subscribers, it saw its cable revenue grow 5%. The cable companies' growth didn't come at the expense of the telcos' either, though, with Verizon adding 299,000 new FiOS TV subs and AT&T adding 284,000 U-verse subs. 

Cable is clearly IPTV's biggest competitive threat — and the reason telcos got into the business in the first place — but both Comcast and TWC cited increasing competition from telcos as giving them a run for their money as well. With the competitive landscape heating up, growth won't be as easy to come by in future quarters.

On a Telephony Webcast this week, Jeff Heynen, directing analyst for Infonetics Research, told attendees why personalization may be the best bet as a differentiator. It can come in many forms, and operators still are in the very early days of experimenting with what works. Personalization can mean widget-based interfaces for improving the TV experience and adding Internet content to the bigger screen. It can be something as simple as improving search and discovery or making a concerted effort to increase interactivity and bring social networking to the TV experience.