Emerging Markets = Satellite Pay-TV Growth

The satellite pay-TV industry took in revenues close to $90 billion in 2011, up from $79 billion in 2010, and those numbers could reach close to $150 billion in 2021 – mostly due to subscriber take-up in such emerging markets as Latin America, Central Europe, Russia, the Middle East, Africa and Asia.

According to Euroconsult, these new markets will account for 44 percent of the global marketplace by 2021.

According to new data from the research firm, the number of TV platforms in service increased to almost 140 in 2011, reaching 184 million subscribers. Close to 350 million households should subscribe to satellite pay-TV platforms worldwide by 2021, representing a 6.7-percent CAGR during the 10-year period.

In the last decade, satellite pay-TV subscriptions grew by at least 10 percent every year. The positive trend continued in 2011, when worldwide subscriptions increased by around 16 percent. Some of the fastest growing markets include Brazil, Russia and India; Asia has become the leading region in terms of subscriptions thanks to the booming Indian market, the group notes. In 2021, an expected 77 percent of worldwide subscribers should be located in emerging regions versus 60 percent in 2011.

"Emerging regions will take on the majority of subscriber growth going forward, as mature markets focus more on profitability," comments CEO Pacôme Révillon. "Many platforms were launched in the past five years, which means they must now start delivering results. To accomplish this, platforms are increasing fees and services offered in order to increase revenues and margins. For those relatively mature platforms that cannot reach profitability in the near future, the threat of consolidation is always around the corner."

Continued Investment

Pay-TV platforms are investing in such value-added services as HD, 3D and next-generation set-top boxes (STBs) to develop competitive advantages. In particular, 90 platforms had HD channels in their line-ups at the end of 2011, up from the 2009 total of 48 platforms distributing HD content. More than 2,800 HD channels were distributed by platforms worldwide in 2011, following the launch of close to 600 HD channels during the course of the year. HDTV and such emerging formats as 3DTV and Ultra HD should drive channel growth over the coming decade.

Next-generation STBs already have been rolled out in some countries, but they remain limited in the satellite pay-TV industry. Satellite pay-TV platforms want to address several key performance metrics with their next-gen STBs, including subscriber numbers and market share, churn rates, average revenue per user (ARPU) and multi-play penetration.

"Next-generation STBs that include OTT delivery provide satellite pay-TV platforms a means through which to deliver ‘true’ VoD services," adds Dimitri Buchs, a Euroconsult consultant. "As a consequence, these boxes allow them to compete more directly with cable and IPTV service providers on that front. Terrestrial service providers have been able to provide ‘true’ VoD services for several years now. Apart from the competitive advantage, the roll-out of next-generation STBs is also likely to limit the move from linear pay-TV subscriptions (i.e., satellite pay-TV, IPTV) to TV and video services received via OTT."