Times, and video delivery technology, are indeed changing fast, Infonetics Research found in its latest “Pay TV Services and Subscribers” report. Cable service providers need to take note and act, and fast, if they haven’t already. If they have, they may need to consider new options that they’d probably rather not consider.
Net new cable video subscriber numbers continue to decline in North America and the Europe-Middle East and Africa markets, and the small increases in Asia and Central and Latin America aren’t offsetting those declines, Infonetics found.
“In 2008, cable video made up 59% of the global pay TV market, satellite video brought in 38% and IPTV was just a drop in the bucket. Now cable operators are being challenged not only by attractive pricing and services from IPTV and satellite operators, but by all over-the-top (OTT) video services, like Netflix and Amazon On-Demand, and by connected-TV devices, which are prompting consumers to cut the cord,” Jeff Heynen, Infonetics’ directing analyst for broadband access and video, stated in a news release.
“While we don’t expect OTT to have a significant impact on pay TV subscribers because operators are responding to OTT with their own enhanced delivery offerings, we do expect cable video’s share of pay TV revenue to decline as satellite video increases — nearly catching up to cable by 2015 — while IPTV services grow to 15% of the market.”
Key findings in the Infonetics’ report include:
- The global pay TV market – including telco IPTV, cable and satellite video services – totaled $125 billion in 1H 2011. Infonetics forecasts it will grow to $353 billion by 2015.
- Satellite video and telco IPTV services will account for most of that growth.
- North America continues to be the highest value pay TV market, with the highest average revenue per user (ARPU) numbers. Asia-Pacific ARPU ranks second in a region where the pay TV subscriber base is
nearly four times the size of North America’s.
- DirecTV and Comcast were the pay TV market leaders in terms of service revenue and subscribers globally in 1H ’11, respectively. DirecTV continues to benefit from the highest ARPU in the industry, while Comcast’s subscriber base now totals some 22.5 million.
- The top 20 pay TV revenue leaders accounted 52% of revenue in this year’s first half, while representing just 29% of total subscribers.