The following post comes from Kagan, a media research group within S&P Global Market Intelligence. To learn more about this research, please request a call.
Video subscriber losses and a maturing broadband segment are weighing on the U.S. cable industry's revenue growth prospects in the 10-year forecast, a trajectory exacerbated in the outgoing years by the absence of a next big, new residential revenue opportunity.
Traditional video revenue erosion remains du jour, with annual rate hikes failing to offset subscriber losses to sustain growth, cascading down to the sector's overall revenue tally. However, according to Kagan, a media research group within S&P Global Market Intelligence, a healthier outlook than previously anticipated in the first five years is in the cards, reflecting cable's video competitive advantages in a legacy multichannel universe grappling with secular transformations.
Decelerating HSD customer gains in the last few years of the projected timeline are expected to magnify the trend, resulting in a notable downgrade in gross industry revenue expectations.
The 10-year outlook calls for total residential revenue to rise to $112.29 billion by 2027 from $110.84 billion in 2017, with the HSD segment, though growing at a relatively sluggish 2.1% CAGR, contributing the bulk of the gains. Taking into account that the commercial-services category is expected to advance at a 5.2% CAGR will help push total industry revenues to $137.90 billion by 2027 for overall gains of $11.71 billion over the 10-year interval.