The Penetration Equation Technical details of the penetration equation are summarized below. For further discussion see R. E. Park, *Prospects for Cable in the 100 Largest Television Markets." V1 = number of B-contour off-air VI☛ signals of type i Pen- penetration subscribers/households passed by cable - annual price Y - median family income c. color set penetration ■ • tid set penetration In order to use Park's estimated equation to predict penetration for the typical systems investigated in this report, representative values must be assigned to the variables of the equation. The following values are employed in all of the simulations: P = $62.40, corresponding to the $5 per month plus $1 C = 50%. The effect of varying color set penetration is not estimated with sufficient precision to incorporate variations in color set ownership across different types of markets. In simulating cable systems for this study, we consider systems located in the central area of a television market, where off-the-air signal quality is generally high, and outlying areas of the same market, where quality is diminished. In the penetration equation the distance variable d is a measure of the reduction in quality. A ₫ value of 0 corresponds to a viewer in the center of the market, while a value of 1 represents a viewer at the B-contour of the off-the-air signal. For the systems in this study we have used the following values: Tables 9 and 1", "Ten Percent Most Favorable Penetration conditions," are calculated using 11% of the penetration mpiled by Park's equation above. This correst inds approximately to the penetration value at the upper 10% confidence .im.t. Sloan Commission on Cable Communications, On the Cable: The Television of Abundance, McGraw Hill, New York, 1971. Weinberg, Gary, "Cost Analysis of CATV Components: Final Report," RMC Report UR-170, June 1972, prepared for the Office of Telecommunications Policy. Federal Communications Commission, "Cable Television Service: Cable Television Relay Service," Federal Register, Vol. 37, No. 30., Part II, (Feb. 12, 1972), pp. 32523341. Federal Communications Commission, "Cable Television Service: Reconsideration of Report and Order," Federal Register, Vol 37, No. 136, Part II. (July 14, 1972), pp. 13848-13910 Television Digest, Inc., CATV and Station Coverage Atlas, 1971-1972, Washington, D.C.. Television Digest, Inc., Television Factbook, Services |