II.

Cable Television Around the World

In its modern, multichannel form, cable first became established in the 1970s in the United States. By the end of 2001 more than 72.9 million US homes—around two thirds of the country’s 105.4 million homes with television—were subscribing to cable television.

In the United States, cable was able to develop without competition from DTH (which was launched only in 1994). In Britain, broadband cable got off to a slow start in 1983, and investment came only towards the end of the decade and in the early 1990s, when US cable and, particularly, telephone operators were stimulated by an improvement in the programming and legislation allowing them to offer telephony services.

Since 1989, however, cable in Britain has had to compete against a DTH service provided by Rupert Murdoch, while at the same time relying on Murdoch to provide most of cable’s programming. The slowness of constructing cable systems, the higher price of cable programming, and the inability of cable to offer popular cable-only services led to a cable subscriber-base of only 3.6 million subscribers by the end of 2001 (out of 12.5 million homes passed by cable), against 5.7 million DTH subscribers. The success of cable telephony—with more subscribers than cable television—and hopes that interactive services will be popular compensate for the poorer than expected performance of cable television. However, since 2001 both Telewest and in particular NTL have decided to conserve cash in attracting new subscribers, concentrating instead on maximizing revenue from their existing subscriber base.

Cable television has grown much more successfully in some European countries, in particular the Netherlands, Belgium, and Germany. German cable was helped when the government and state-owned Deutsche Telekom decided to install cable across what was then West Germany. By the end of 2001, some 20.6 million German homes were hooked up to cable. Germany is large enough to support a significant DTH market as well, with more than 12.9 million subscribers (December 2001). In all three nations cable is treated as a low-cost utility service.

Most European countries are developing either cable or DTH systems, largely depending on their topography. The most rapid development, however, is taking place in Asia, where Murdoch and US programmers are seeking to start DTH services and to feed emerging cable networks (see Satellite Television). Among these newer networks are those of Foxtel and Optus Vision in Australia, whose services are also available via DTH satellite.

There is clearly a demand for multichannel television in the United States and many other countries across the world. It is not clear, however, how great the demand is or whether it exists for the more advanced, interactive services that are being introduced.