Competition Intensifies


All in all, it hasn't been a bad year for cable operators, particularly in comparison with 2002, when accounting scandals shook the industry and drove share prices for publicly traded companies down by as much as 70 percent.

Strong sales for cable modems and digital cable have helped buoy results for many companies this year, while emerging VOD and HDTV businesses hold the potential for additional gains in the future.

Our listing of the 25 largest cable and satellite operators offers a snapshot of the subscription TV industry today. Among its more obvious messages: Competition between cable and satellite operators remains a key issue for both industries.

DirecTV and EchoStar, now the second and fourth ranked companies in our listing of the top 25 operators, picked up nearly 2.2 million new basic customers since a year ago.

Of the 23 cable companies on our list, 10 lost basic subscribers since a year ago, although six of those did so as a result of system sales. Adelphia Communications and Charter Communications suffered the most serious customer attrition. Together, they gave up nearly 1 million basic subscribers during the past 12 months.

The rivalry between cable and satellite could intensify significantly next year, if News Corp. receives government approval to buy 34 percent of DirecTV.

Except for Comcast's acquisition of AT&T Broadband last year, merger and acquisition activity has been relatively quiet during the past 12 months. Two new companies, Advance/Newhouse and Bresnan Communications, entered our list of the top 25, while U.S. Cable, last year's 25th ranked company, has been bumped to number 26.

One company, Adelphia, is in receivership this year, compared to two in last year's listing, when Classic Cable had not yet emerged from bankruptcy.

For the most part, the information in our survey of the top 25 cable and satellite operators came from the companies themselves. Financial analysts supplied some of the statistics for publicly traded companies.