America’s Competitive TV and Internet Markets

In 1992, 98 percent of American homes relied on cable to watch subscription TV. There were no satellite TV options or telco-provided TV options. There certainly weren’t internet streaming options because, among other reasons, broadband wouldn’t be launched for another four years. It would be a full decade after that before a video streaming service would be made available. 25 years later, the TV marketplace is undeniably different. Technologies like cloud DVRs, apps, and TV Everywhere have transformed the way we watch television. Many of the best content creators are choosing TV to tell their stories. But perhaps most noticeably, the marketplace has become robustly competitive.

According to the FCC, 99 percent of U.S. homes have access to at least three multi-channel subscription TV services. Cable’s historic dominance has dissipated into a market where 54 percent of homes with multichannel video services are cable video customers, 34 percent are satellite video customers, and 12 percent are telco TV customers. Not so coincidentally, as fast broadband networks have become ubiquitous throughout America, additional pay TV competition has emerged from new players who use the internet to deliver programming. The dominant player is Netflix, a premium streaming service that has become an entertainment powerhouse. It has 50.9 million U.S. subscribers, more than the entire cable industry. The next largest video service provider, AT&T/DirecTV has less than half that, 25 million. And Comcast, the largest cable video provider has 22.5 million customers.