Monday, January 31, 2011

New generation of TV services begin to close gap on cable

MELBOURNE, AUSTRALIA: Cable will retain dominance in the global multi-channel TV market over the next five years but the threat from the new generation of digital and internet protocol (IP) services will take its toll, predicts Ovum.

Globally, cable TV will reach 573 million households by 2015, but will grow by an average of only three per cent per year for that period. The strongest growth will come from internet protocol TV (IPTV) with a compound annual growth rate (CAGR) of 24 per cent over the next five years to reach 109 million households.

Jonathan Doran, Ovum analyst and author of the report, commented: “DTT growth will be fuelled primarily by the further allocation of spectrum for free-to-air services and the implementation of analog switchover deadlines, while telcos will continue to aggressively market their IPTV offerings as they play catch-up with the longer-established cable and satellite pay-TV platforms. Satellite pay-TV will remain stable in the face of competition from emerging low-cost services as it continues to attract a core of higher-value subscribers than cable.”

The Asia-Pacific region will experience strong growth in IPTV subscribers over the forecast period, growing from 15.6 million households in 2010 to 43.2 million in 2015. However, cable will remain the dominant subscription TV platform in the region, with 388 million households connected by 2015. Satellite TV will experience healthy average annual growth of ten per cent over the next five years to reach 419 million households worldwide, 143 million of which will be in Asia-Pacific.

In Australia, digital terrestrial will remain dominant, reaching 5.894 million households by 2015, compared to just 823,000 for satellite. Cable will experience slow growth, reaching 2.175 million Australian households in 2015, up from 2.080 million in 2010. IPTV services will struggle for scale in the Australian market, reaching only 342,000 Australian households by 2015, despite strong growth from the 2010 figure of 90,000 households.

In Greater China, cable will continue to take the lion’s share of subscribers, reaching 242.5 million households, up from 191 million in 2010. Cable will show very slight growth in Japan reaching 26 million households in 2015 (from 25.3 million in 2010) but will decrease in Korea, sliding to 12.2 million households in 2015, down from 13.5 million in 2010.

Ovum expects global pay-TV revenues to grow by nearly 40 per cent by 2015, but this figure masks significant variations between markets as well as platforms.

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