SINGAPORE: Global pay-TV service revenue approached $58 billion at the end of 2Q 2010. This was approximately a 9% increase over the same period in 2009. “The increase in ARPU and service revenue in 2Q 2010 was largely due to the programming packages on offer, with higher prices and more advanced services such as High Definition programming,” says ABI Research’s digital home practice director Jason Blackwell.
The majority of pay-TV service revenue comes from cable TV. It represents approximately 52 percent of the overall pay TV market, followed by satellite TV and IPTV. The year-over-year growth of cable TV service revenue is quite low compared to other pay-TV platforms. This is due to slower subscriber growth in many of the mature cable TV markets. In addition, cable ARPU is declining in some markets due to high competition from IPTV operators.
At the end of 2Q 2010, satellite TV service revenue increased to $24 billion. This is about a 12% increase from the second quarter of 2009.
Research associate Khin Sandi Lynn notes: “The increase in service revenue is driven by both increases in subscriber additions and average revenue per user. Many of the satellite TV operators saw rises in ARPU due to their offers of HD programming packages. For example Direct TV ARPU increased from $83.16 in 2Q 2009 to $87.91 in 1Q 2010 as the result of the boost from higher-priced High Definition programming.”
The IPTV market continues to grow both in terms of ARPU and aggregate service revenue. IPTV subscriber growth is expected to continue in the coming years. ABI Research estimates that global IPTV service revenue will generate more than $40 billion at the end of 2015, with a CAGR approaching 20% from 2010 to 2015.
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