Emerging Markets Sustain Robust Growth for Satellite TV Platforms

Nearly 140 platforms, 184 million subscribers, $90 billion in revenues for 2011

PARIS & MONTREAL — Euroconsult, the leading international research and analysis firm specialized in the satellite & broadcasting sectors, announced today that the satellite pay-TV industry reached revenues close to $90 billion in 2011, up from $79 billion in 2010. Global industry revenues are expected to reach close to $150 billion in 2021, with emerging markets (i.e. Latin America, Central Europe, Russia, the Middle East, Africa and Asia) representing a growing share of revenues that will nearly double over the next ten years to reach 44% by 2021.

According to the just released 5th edition of “Satellite TV Platforms, World Survey and Prospects to 2021,” 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% CAGR over the 10-year period.

In the last decade, satellite pay-TV subscriptions grew by at least 10% every year. The positive trend continued in 2011 when worldwide subscriptions increased by around 16%. 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. In 2021, an expected 77% of worldwide subscribers should be located in emerging regions versus 60% in 2011.

“Emerging regions will take on the majority of subscriber growth going forward, as mature markets focus more on profitability,” said Pacôme Révillon, CEO of Euroconsult. “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.”

Platforms maintain investments in new services to remain attractive

Pay-TV platforms are investing in value-added services such as HD, 3D, and next-generation set-top boxes in order to develop competitive advantages. Ninety platforms had in particular 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 emerging formats (i.e. 3DTV and Ultra HD) should drive channel growth over the coming decade.

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

“Next-generation set-top boxes which include OTT delivery provide satellite pay-TV platforms a means through which to deliver ‘true’ VoD services,” said Dimitri Buchs, Consultant at Euroconsult. “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 set-top boxes 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.”

Key figures for 2011:

Number of platforms                       137
Total subscribers                 184 million
Total revenues                   ~$90 billion
Number of channels distributed         19,650