Digital TV conversion slows in Western Europe
Thursday, April 12th, 2012Western Europe will not reach full digital TV penetration until 2017, despite penetration being as high as 85% by end-2011, according to a new report from Digital TV Research. In fact, only two of the 15 countries covered in the Digital TV Western Europe report had fully converted to digital by end-2011, with another two expected to join them by the end of this year.
Report author Simon Murray said: “Six countries will not reach full digital TV conversion until after end-2015. However, Switzerland, which has the lowest digital penetration rate in Western Europe, will rapidly convert from the 56% penetration it recorded at end-2011.”
Timeline for full digital TV conversion by country:
2008 Finland (100%) 2011 Spain (100%) 2012 Italy (87%); UK (95%) 2013 Portugal (63%) 2014 France (98%); Ireland (72%); Norway (89%) 2015 Denmark (79%) 2016 Austria (73%); Netherlands (76%) 2017 Belgium (70%); Germany (74%); Sweden (69%); Switzerland (56%)
Note: Figures in brackets represent digital penetration at end-2011
Source: Digital TV Research
The 25 million analog homes remaining at end-2011 will be the hardest to convert to digital. Analog DTH signals will cease in 2012 and the last analog terrestrial home will be switched off in 2013 [in Portugal].
Murray commented: “Analog cable homes will be harder to convert to digital as many of these subscribers pay for basic packages as part of their rent. Operators have difficulties in accessing these households as they have to persuade landlords and housing committees to upgrade to digital.”
Western European TV households split by platform (%):
2007 2011 2017 ---- ---- ---- FTA DTT 14 28 28 Digital cable 9 18 26 Pay DTH 14 15 16 Digital FTA DTH 8 11 13 Pay IPTV 2 8 11 Pay DTT 3 5 6 Analogue cable 21 10 0 Analogue Terrestrial 24 4 0 Analogue DTH 5 1 0
Source: Digital TV Research
Western Europe will pass 150 million digital TV households during summer 2012. This total will grow to 175 million by 2017. FTA DTT will remain the most popular platform. Digital cable will not be far behind, by recording 45 million subs in 2017.
Western European pay TV penetration will average at 59% by 2017, up by only three percentage points on 2011. By 2017, pay TV penetration will range from nearly 100% in the Netherlands to only 29% in Spain.
The number of pay TV subs will grow by nearly 10 million between 2011 and 2017 to reach 104 million. This comes despite the loss of 16.5 million analog cable subs over the same period. Digital cable will grow by nearly 16 million subs and IPTV will climb by 6.5 million. However, pay DTH will only increase by 2.5 million and pay DTT by 1.5 million.
Western European pay TV revenues (US$ million):
2007 2011 2017 ------ ------ ------ DTH 12,566 15,729 16,015 Digital cable TV 4,214 8,651 11,373 IPTV 643 2,889 4,072 DTT 531 1,527 2,010 Analog cable TV 6,549 3,555 0
Source: Digital TV Research
Despite the increasing number of pay TV homes, pay TV revenues will remain flat at US$33 billion. ARPU is falling in most countries and on most platforms.
Murray said: “The pay TV arena is more competitive than ever as IPTV platforms launch and as cable operators’ upgrade. Furthermore, rapid growth in higher-speed broadband connections allows more online video viewing [over-the-top TV]. So cable operators now offer cheaper and scaled-down basic TV packages to retain subs and to attract new ones. The knock-on effect saw DTH operators also dropping their basic package prices and reducing channel choice.”
He continued: “TV ARPU also falls as cable operators and telcos convert their subscribers to double-play or triple-play bundles. These subscribers provide operators with higher overall [blended] ARPU than standalone TV subscribers, but lower TV ARPU. Bundles are particularly attractive during harsh economic times as consumers hunt for bargains. Additionally, double-play and triple-play subs are more loyal than standalone ones, thus cutting churn and the related subscriber-retention costs.”
More: Digital TV Western Europe
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