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Pay TV revenue to swing satellite’s way as cable hits bump in the road

A report out this week from US forecaster Digital TV Research says that money spent on satellite TV connections will overtake that spent on cable conn


Published: 30 June, 2011


A report out this week from US forecaster Digital TV Research says that money spent on satellite TV connections will overtake that spent on cable connections for TV by 2016. The report takes in 73 countries where it tracks pay TV revenues, which it says will reach $173 billion by 2016, up by $18 billion (only 12%) from 2010. This seems to imply that overall growth in global pay TV revenues are starting to tail off.

The report says that VoD revenues will increase much faster than subscription revenues, but insists that this will only reach $5.7 billion by 2016 just 3.3% of the pie. We wonder if the researcher took into account a shift to OTT VoD? The report says that subscription revenues will stutter as more homes convert to bundles, thus reducing TV-related income.

Satellite DTH revenues will reach $86 billion in 2016, up from $71 billion now and command nearly half the total revenues with the US remaining the satellite TV market leader. US revenues will fall from 54% of the total, back in 2006 down to just 41% in 2016. Brazil will add the most DTH revenues ($3.1 billion) between 2010 and 2016 – more than doubling its total in the process.

Our own two Rethink reports published earlier this year, Pay TV In Latin America and Pay TV in Europe, have already pointed to many of these changes, with Satellite TV growing from 37% of the pay TV connections in Europe in 2010 (cable is 46%) and rising by 2014 to 38% as cable drops to 37%, as IPTV takes hold. In Brazil Rethink has counted for 2010 some 4.7 million cable homes and 3.9 million satellite homes, but taking in relative growth rates, satellite will sweep almost immediately ahead of cable, rising to 12.4 million homes by 2014, compared to 6.9 million cable homes in Brazil.

Continuing from the Digital TV Research report, cable TV will begin its slide this year, with revenues falling by $7 billion between 2010 and 2016 to $69 billion. Cable operators will continue to gain extra revenues by converting subscribers to bundles, where they are digital, through the addition of broadband and voice.

The digitization of the industry continues apace, and digital cable TV revenues will climb from $43 billion in 2010 to $62 billion in 2016. China will add $4.3 billion in digital cable TV revenues over the same period, followed by Japan with an extra 2.6 billion.

IPTV revenues are of course climbing the fastest, rising to $17 billion by 2016, from just $6 billion today. Digital TV Research says that the US will bring in more revenue than any other country in IPTV bringing in around 25% of the total during 2016 despite the fact that France and China are currently the two largest IPTV installed bases by numbers of homes.

The report also says that Pay DTT is a dead loss and revenues have so far only reached $1.6 billion in 2010, and will rise slowly to just $2.3 billion by 2016 with Italy supplying almost a half of the 2016 total.

The US will remain the world’s largest pay TV revenue earner by some distance but its revenues will fall by nearly $3 billion between 2010 and 2016 as homes convert to bundles and as competition increases. Brazil’s revenues will more than double over the same period, with India also enjoying impressive growth.


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