3.2.8
2.
At these prices and at maturity BAH estimates that 25% of all subscribers will buy the basic service, 45% the enhanced service and 30% the premium service.
Connection rates
While HKT has been less optimistic than HCV in forecasting penetration rates, BAH's view is that both these estimates are optimistic. Cable penetration forecasts are often overstated in planning proposals and then scaled down after the first few years of the building programme.
Experience in the United States in developing cable
In the United States cable evolved simultaneously with broadcast television during the fifties principally to provide a higher quality of television reception. In fact it was originally entrepreneurs who erected private receivers to capture existing broadcast signals who later became the operators of the cable antenna television systems
(CATV). The United States is now a "mature" cable market with overall penetration rates running at 56% of the 64.5 million homes passed by cable. The rapid growth rates of the early eighties (with connections rising by 17-26% p.a.) has tapered off indicating a saturation level for audiences around the 60% level after 25 years. Recent build programmes in the United States have achieved relatively rapid penetration rates due to the high degree of audience awareness of the benefits of cable television. Boston for example has achieved a 42% penetration rate after only 5 years and New York has achieved an ever higher rate of 52% after six years partially due to the higher subscriber densities in the vertical residential apartment blocks.
Experience in Europe
In contrast, cable development has progressed far more slowly in Europe. The three highly cabled countries, Belgium (which will be 88% cabled by 1991), Netherlands (71%) and Switzerland (57%), are the exceptions to the otherwise very low penetration rates. They originally developed their systems to operate as radio relay systems or to eliminate interference from other broadcasters or mountains. In the remainder of the European countries, cable has been used sparingly and primarily to improve transmission in specific areas. In most countries in Europe the PTTS have had a monopoly over the cable systems, including the links, transmission equipment, facilities and headends. [2] They have constructed and installed the systems and have been responsible for their maintenance. Their monopoly has been protected by a 1960 Council of Europe agreement, the 'European Agreement on the Protection of Television Broadcasts'. Further, the lack of a large market for cable-delivered national programming, and the relatively high availability and standards of off-air broadcasting, have both served to depress cable demand. As a result of the above factors, cable-TV has been less successful than in the United States and it has failed to reach the penetration rates forecast in so many proposals that were based on United States experience. The United Kingdom for example has achieved only a 'poor' 190,000 connections out of 1.2 million homes passed.
With the exception of Austria, Belgium, Luxembourg, Switzerland and the United Kingdom.
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