Slowdown for Russian pay-TV

Growth in Russia’s pay-TV market is likely slow this year, both in subscriber numbers and value terms.

According to a forecast by J’son & Partners Consulting, published by Kommersant, they will fall from 10% to 4% and from 14.2% to 9%, with operators unable to continue their regional expansion due to difficulties in obtaining long-term loans and also experiencing increased competition from online video services.

Russia’s pay-TV market grew by 10% in 2013 to 35.1 million at year’s end, equivalent to 64% of all households in the country.

At the same time, its value increased by 14.2% to R57.1 billion (€1.2 billion).

As the largest segment, cable accounted for 54.6% of total revenues, followed by DTH (32%) and IPTV (13.3%). However, IPTV was the fastest growing (47.2%), with DTH (18.5%) and cable (0.02%) significantly behind.

Pay-TV ARPU in 2013 was R136, with Tricolor TV charging the lowest monthly fee (R75/month).

NSC had the most subscribers (29% share), followed by Rostelecom (21%), MTS (7.4%), ER-Telecom (7.4%) and Orion Express (5%).

Russia’s pay-TV market is set to grow by an average of only 3% a year over the next five years and will be worth R75.9 million in 2018.

The subscriber base will grow by 17% to 40.9 million, with the penetration increasing from 64% to 75%.

Cable, though still the most popular method of reception, will see its share drop to 48%, with DTH remaining the same at 33% and IPTV growing to 18%.

J’son & Partners Consulting’s figures differ from those produced earlier by iKS Consulting.

Among its forecasts were that the pay-TV market would grow by 5% in subscriber terms this year to 36.2 million and in value by 10% to R59 billion.