IPTV overtakes pay satellite TV in Asia Pacific

The number of paying IPTV subscribers in the Asia Pacific region overtook paying satellite TV ones in 2015, according to a new report from Digital TV Research. Covering 22 countries, the fifth edition of the Digital TV Asia Pacific Forecasts report states that IPTV growth is far from over with 123.5 million subscribers expected by 2021. China will contribute 78.4 million IPTV subs (or nearly two-thirds of the region’s total) by 2021.

Source: Digital TV Asia Pacific Forecasts published by Digital TV Research.

Of the 314 million digital TV homes to be added between 2015 and 2021, 107 million will come from DTT. Conversely, the number of analog terrestrial homes will fall by 158 million. Digital cable will contribute 113 million additional homes, with analog cable losing 72 million. Pay satellite TV will supply an extra 30 million, with FTA satellite TV adding 10 million.

Simon Murray, Principal Analyst at Digital TV Research, explained: “So pay TV penetration will rise from 61.1% in 2015 to 69.2% in 2021, adding 127 million subs to take the total to 647 million. Even more impressive is that digital pay TV penetration will climb from 21.2% in 2010 to 44.9% in 2015 on to 68.3% in 2021. Digital pay TV subscribers will nearly quadruple from 164 million in 2010 to 639 million by 2021.”

He continued: “China will provide 329 million pay TV households by 2021, with India supplying a further 178 million. However, legitimate pay TV penetration will be lowest in Thailand (30.2%), Australia (31.7%) and Indonesia (32.6%).”

Despite the economic growth slowdown and devaluation of most currencies against the US dollar, pay TV revenues in the Asia Pacific region will reach $40.00 billion in 2021; up from $24.34 billion in 2010 and $31.94 billion in 2015. Digital pay TV revenues will triple from $14.4 billion in 2010 to $39.61 billion in 2021.

Pay TV revenues will more than double in five countries (Bangladesh, Indonesia, Laos, Myanmar and Pakistan) between 2015 and 2021. However, revenues will fall during this period in a further five countries (Australia, Hong Kong, New Zealand, Singapore and South Korea).

IPTV overtakes pay satellite TV in Asia Pacific

The number of paying IPTV subscribers in the Asia Pacific region overtook paying satellite TV ones in 2015, according to a new report from Digital TV Research. Covering 22 countries, the fifth edition of the Digital TV Asia Pacific Forecasts report states that IPTV growth is far from over with 123.5 million subscribers expected by 2021. China will contribute 78.4 million IPTV subs (or nearly two-thirds of the region’s total) by 2021.

Source: Digital TV Asia Pacific Forecasts published by Digital TV Research.

Of the 314 million digital TV homes to be added between 2015 and 2021, 107 million will come from DTT. Conversely, the number of analog terrestrial homes will fall by 158 million. Digital cable will contribute 113 million additional homes, with analog cable losing 72 million. Pay satellite TV will supply an extra 30 million, with FTA satellite TV adding 10 million.

Simon Murray, Principal Analyst at Digital TV Research, explained: “So pay TV penetration will rise from 61.1% in 2015 to 69.2% in 2021, adding 127 million subs to take the total to 647 million. Even more impressive is that digital pay TV penetration will climb from 21.2% in 2010 to 44.9% in 2015 on to 68.3% in 2021. Digital pay TV subscribers will nearly quadruple from 164 million in 2010 to 639 million by 2021.”

He continued: “China will provide 329 million pay TV households by 2021, with India supplying a further 178 million. However, legitimate pay TV penetration will be lowest in Thailand (30.2%), Australia (31.7%) and Indonesia (32.6%).”

Despite the economic growth slowdown and devaluation of most currencies against the US dollar, pay TV revenues in the Asia Pacific region will reach $40.00 billion in 2021; up from $24.34 billion in 2010 and $31.94 billion in 2015. Digital pay TV revenues will triple from $14.4 billion in 2010 to $39.61 billion in 2021.

Pay TV revenues will more than double in five countries (Bangladesh, Indonesia, Laos, Myanmar and Pakistan) between 2015 and 2021. However, revenues will fall during this period in a further five countries (Australia, Hong Kong, New Zealand, Singapore and South Korea).

Kazakhstan's Alma TV to launch IPTV in the first half of 2016

Kazakhstan cable TV operator, Alma TV, has released a review of the activities of the company in 2015. During the year, the company added five major cities to its digital television network – Taraz, Taldykorgan, Ekibastuz, Aksu and Kokshetau.

In late December, the operator launched in beta an interactive TV service called TV BOX, using OTT technology.

In addition, the company has been developing its broadband access business with DOCSIS 3 technology, and said that it will launch an IPTV service in the first half of 2016.

IPTV grows in Russia

Russia ended 2015 with 2015 with 5.52 million IPTV subscribers, a 20.2% increase on the total a year earlier.

At the same time, according to figures produced by TMT Consulting and quoted by ComNews, the total number of pay-TV subscribers in the country increased by 3.7% to 39.4 million, compared to an 8.6% rise in 2014.

IPTV was the fastest growing pay-TV segment in 2014, while last year, in absolute terms, the increase in the IPTV subscriber base matched that in the satellite TV one.

In Moscow, IPTV accounted for 48% of new pay-TV connections in 2015 thanks largely to the new MGTS GPON fibre-optic network.

Rostelecom accounted for the majority of IPTV connections in Russia as a whole, gaining 0.6 million to reach 3.3 million at the end of last year.

Although cable remains the most popular way to receive pay-TV services in Russia, accounting for 46% of connections and followed by satellite (40%) and IPTV (14%), it is starting to IPTV, losing 1.5% of its subscriber base in 2015.

IPTV grows in Russia

Rostelecom is to undertake a large-scale modernisation of its Interactive TV platform, launched only three years ago.

According to Comnews, the process is likely to cost R344 million (€6.4 million).

It adds that the telco has already announced two tenders, the first being for the supply of equipment by Huawei, Juniper, Intel and Cisco.

The modernisation is linked to the strong growth of Interactive TV’s subscriber base.

Although Rostelecom has not provided a figure for its size, it is believed to have increased by 24% in 2014 to 2.7 million.

Rostelecom is the leading player in Russia’s IPTV sector, which though smaller than cable and DTH is growing much faster, even despite the current economic crisis.

The total number of IPTV subscribers in the country is expected to reach 5 million this year.

Deutsche Telekom records stronger IPTV growth

Germany’s national telco Deutsche Telekom won 65,000 new customers for its domestic IPTV platform Entertain in Q4 2014.

Entertain is contining to grow quicker than in previous quarters: In Q3 2014, Telekom recorded 59,000 new customers while Q4 2013 saw 56.000 additions. In total, Entertain had 2.44 million customers on December 31, 2014.

The number of broadband customers rose by 0.2% to 12.36 million.

Telekom recorded growing demand for its fibre-optic broadband products FTTH and VDSL: In Q4 2014, 323.000 customers signed up for a fibre-optic line – 143% more than in 2013. The total number of fibre-optic customers rose by 66% to more than 2.5 million within a year.

France: DTT goes down, while IPTV remains stable

Digital terrestrial reception is still dominant in France, but the number of people using DTT is slowly going down, according to media authority CSA.

The CSA has just published the figures over 2013.

At the end of 2013, 57.9% of viewers were watching DTT (-1.8%) and for 33.3% of viewers DTT was the only means of reception (down 0.5%).

49.1% of viewers are watching via IPTV or cable (+0.3%). Satellite DTH reception was slightly up (+0.2). 82.8% of viewers now have an HD set.

In terms of reception equipment, 97.6% of viewers have a TV set, down 0.5%. More people are now using their computer to watch TV (78.8% of viewers, +1.1%), tablets (28.7%, +7.2%) or smartphones (55.9%, +4%).

LG Uplus rolls out VoD, IPTV services on LTE platform

South Korean telecommunications operator, LG Uplus, has launched a Video-on-Demand (VoD) movie streaming service, UflixMovie; a mobile IPTV service, Uplus HDTVNew; and a personal broadcasting platform, Uplus tvG, on its advanced Long Term Evolution (LTE) network platform – to aggressively tap and lead the video LTE era.

LG’s UflixMovie will provide access to over 12,000 video contents of films, dramas and overseas TV series at the flat cost of KRW 7,000 (USD 6.86) per month. And the company plans to expand content to 13,000 within this year and subscribers of other carriers are also provided access to this service.

In its mobile IPTV service, Uplus HDTV, LG has embedded the ‘Time Machine’ functionality that enables users to save programs that they are watching in real time for two hours and the ‘Slow Motion’ function which allows users to watch important scenes at 0.5 time speed. With Uplus tvG, users can broadcast in real time through the broadband LTE network.

LG Uplus is offering a broadband LTE-A plan at the cost of KRW 89,900 (USD 88.1) per month for subscribers to avail the various video services.

BesTV Indonesia, Home Digital Media provide OTT, IPTV services

China-based technical, content and marketing services provider for TV and mobile terminals through media source platforms, BesTV Indonesia and Home Digital Media, a subsidiary of Indian MSO, Home Cable Network, have joined hands to roll out OTT/ IPTV services on various application platforms such as Intan, MyTVapp, Relay TV and Home Digital TV.

Both the companies aim to target over 25 million Indian expats and over three million airtime and maritime passengers, by using the content delivery network (CDN) of Akamai and Octoshape. The companies have been working on this project for the past three years.

“This strategic association will provide live TV channels, movies and music-on-demand content through various applications specially developed for Android, iOS, 3GPP and Windows,” said Vikki Choudhry, Managing Director of Home Cable Network.

Nepal to get IPTV services

Two separate companies – Orient Digital Media and Subisu Cable Net – are currently on a race to become the first companies to introduce IPTV services in Nepal. This would be the first time such a service was operated out of the country.

Subisu CEO Sudhir Parajuli noted that the company hopes to launch the services as early as March of this year. He further added, “We are hopeful to get the government permission within a week and currently the company is currently working on the packages to be offered.” Subisu is one of the top internet providers in Nepal. Orient on the other hand had acquired the permission from the government nearly eight months ago but it has not started it services yet.

In case of Subisu, it is planning on launching a 15 channel IPTV service as of right now. The licence that was already given to Orient was under the condition that the company should start its services within 18 months of having acquired the licence. State-owned Nepal Telecom (NT) is also in the process of launching its own IPTV service but the plans are at a nascent stage.

IPTV without the box in CI Plus upgrade

A new version of the DVB Common Interface platform has been launched by the DVB at IBC 2013. In a demonstration the standard setting organisation showed at SmarDTV CI Plus 1.4 Conditional Access Module and a Phillips television set, running an IPTV application developed by Accenture.

Once the module is inserted an automatic discovery process starts to find the location, any available IPTV channels, and retrieves the operator’s virtual STB application. CI Plus 1.4 can be used for the delivery of linear and VOD channels, significantly it can also access a network PVR.

Although there have been proprietary solutions, most notably Samsung’s implementation with TeliaSonera, the DVB said there had been a call for standardisation. However, the new module does require a compatible television set, so the existing product will remain in place for some time to come. European operators have launched CI Plus as an alternative to the set-top box in a number of markets.

Host middleware includes HbbTV – the format used in the DVB on-stand demo, MHP and MHEG-5.

Official publication of the specification as a DVB BlueBook is expected later this month, while the required OIPF specifications are expected for publication in early 2014.

Development of CI Plus 2.0 is underway including a new form factor.

It is expected that new television sets supporting the new specification will appear on the market around 2015/16.

IPTV defies drop in US pay TV market to gain subscribers in Q2

Amid a plunge in subscribers for cable and satellite providers, Internet Protocol Television (IPTV) was the only segment of the U.S. pay-TV market to achieve growth in the second quarter, according to a new Television Intelligence report from IHS Inc., a leading global source of critical information and insight.

The U.S. IPTV providers—represented by AT&T Uverse and Verizon FiOS—boasted a net addition of 398,000 during the April to June period, up from 304,000 in the second quarter of 2012. Nonetheless, the overall U.S. pay-TV market also shed 352,000 subscribers during this time.

The main culprit for the pay-TV market’s nosedive was the cable segment’s loss of 588,000 subscribers. While that was slightly better than the 598,000 customers that cable shed during the same time last year, the decrease still represented a major plunge for the embattled business. Meanwhile, satellite’s decline widened to 162,000 subscribers, up sharply from 62,000 a year ago.

Based on the number of total subscribers at the end of the period, cable clung to 55 percent of the U.S. pay-TV market, satellite held 34 percent and IPTV had an upwardly mobile share of 11 percent.

Of the three segments in the U.S. pay-TV market, the IPTV sector is enjoying the strongest growth, especially in urban areas where it is luring subscribers away from satellite. In particular, satellite’s lack of a true high-speed Internet service or a triple-play bundling option puts it at a disadvantage when competing against IPTV and cable. Cable, meanwhile, has its own problems, including disagreements between operators and content providers over rising programming costs that squeeze cable customers in the middle.

The recent tiff between CBS and Time Warner over carriage fees—with CBS going black on Time Warner and the cable giant’s subscriber base then getting locked out of CBS programming—demonstrates the kind of difficulties that cable could endure in the future.

US subscribers tune out pay-TV

The internecine fight among the three rival segments is particularly acute because the overall base of potential new subscribers is diminishing over time. The decline in the second quarter means that the total number of U.S. pay-TV subscribers will contract by 146,000 during the initial six month of the year, the first time ever that the industry began the first half of a year with a net loss in pay-TV customers.

More significantly, 2013 is set to mark the first year that there will be an annual decline in total U.S. pay-TV subscriptions, IHS projects. Subscribers are forecast to decline to 66 million, down from 67 million last year.

The market’s downshifting can be traced in part to the growing number of so-called “cord-nevers”—i.e., those who object to ever having a pay-TV subscription, and instead get their TV programming exclusively via over-the-top services like Netflix or through other sources. Equally as important, the price of a typical pay-TV subscription remains high, staying well out of reach for a large number of consumers. Confronted with economic choices, consumers prefer to keep their cellular and high-speed data service rather than a pay-TV subscription.

IPTV becomes must-see TV

Both AT&T and Verizon, however, appear to be bucking the trend of a shrinking customer base. AT&T’s Uverse attracted 233,000 new subscribers in the second quarter, its second-largest sequential increase since 2009. Verizon’s FiOS, meanwhile, showed it had plenty of room for growth by gaining 140,000 new subscribers. Already, Verizon has achieved a 50 percent penetration rate in the pay-TV market of Dallas, Texas, its first area of launch.

Diversify or die

For their part, both cable and satellite—bleeding from customer defections or non-renewals—are exploring opportunities to diversify services, including new paradigms to deliver content to the home and even completely new fields like home-monitoring services.

For instance, DirecTV, which lost 84,000 customers in the second quarter, will be the latest pay-TV provider to offer services related to home security via a recent acquisition engaged in that market. Home security ostensibly will provide a new revenue stream, offering significant upselling opportunities that come in the presence of a video installation.

Other potential revenue boosters for cable and satellite providers include the “TV Everywhere” solution that allows content to also be accessed on computers, smartphones and tablets; and initiatives like Cox Communications’ flarewatch, the first pay-TV-owned broadcast-delivered IPTV service.

IPTV and OTT to drive European pay-TV growth

IPTV and OTT video services to account for most pay-TV growth in Western Europe between 2013 and 2018, according to Analysys Mason.

The real impact of OTT video services will be felt on secondary TV sets, where such services will drive a decline in traditional multi-room services.

In Analysys Mason’s latest pay-TV forecasts, the research company expects that the number of households taking pay-TV services in Western Europe will increase by 9.2 million to 113.3 million, which amounts to 8.9% growth between 2013 and 2018.

Take-up of over-the-top (OTT) video services will grow much more strongly than traditional pay-TV services, but cord-cutting will not be extreme – OTT video to the TV set will account for just 5.6 million primary pay-TV services by 2018. The real impact of OTT will be felt on secondary TV sets – traditional operators could broaden their reach with their own OTT services to these sets. A shift towards IPTV and OTT and away from cable explains stable top-level Western European pay-TV household numbers.

The number of Western European households taking up traditional pay-TV services – delivered via analogue or digital cable (including multichannel multipoint distribution services (MMDS), also known as wireless cable), IPTV, pay-digital terrestrial TV (DTT) or satellite – will increase by 4.1 million to 107.7 million, representing 3.9% growth between 2013 and 2018.

These overall modest gains for traditional pay-TV services belie substantial variations between the performance of individual platforms – the gains for some platforms will be nearly offset by losses for others during the forecast period.

Analysys Mason expects that the number of cable households will decrease by 6.2% to 43.6 million between 2013 and 2018, representing a net loss of 2.9 million, as some analogue cable subscribers defect to digital platforms other than cable, including free-to-air (FTA) DTT services.

The number of pay-DTT households is expected to decline by 7.7% to 4.9 million, a net reduction of 0.4 million as pay-DTT loses its momentum in major markets such as France, Germany and the UK.

The number of satellite pay-TV households will increase by 3.7% to 31.6 million, amounting to a net gain of 1.1 million as growth in some markets, notably Germany, offsets decreases in others, such as Italy and Spain.

The number of IPTV households will increase by 29.0% to 27.6 million, an increase of 6.2 million. Analysys Mason expects strong growth for IPTV in many countries, mostly because of aggressive bundling strategies by telcos, which are offering basic pay-TV services at little or no incremental cost within multi-play propositions in order to gain market share.

Low-end IPTV services, such as Swisscom TV light, which was launched by the Swiss incumbent in November 2012 as a free add-on for its DSL subscribers, enable consumers to benefit from the latest features of digital TV services, such as access to on-demand content, without incurring the upfront cost of equipment, which can easily amount to EUR200 or more. Operators may want to offer their own OTT video propositions in order to tap into new growth opportunities

The real impact of OTT video services will be felt on secondary TV sets, where such services will drive a decline in traditional multi-room services. Analysys Mason still believes that cord-cutting will not be significant in Western Europe. The number of Western European households taking up OTT video services as a primary form of pay-TV will increase by 5.2 million during the period, from 0.4 million in 2013 to 5.6 million by the end of 2018.

OTT video services extend the overall market for pay-TV services by appealing to consumers who would not consider taking up traditional pay-TV services, perhaps because of the cost or level of commitment involved. In particular, the emergence of OTT video services gives consumers direct access to premium and/or niche content without the requirement to commit to other subscriptions (either for basic pay-TV or a bundle of services) as a prerequisite, bringing consumers more freedom and flexibility.

‘Pure-play’ OTT video providers such as Netflix need not be the only ones benefiting from this new growth opportunity. Pay-TV operators with niche and/or premium content can broaden their reach by targeting non-subscribers with their own OTT video services, ensuring that they are pitched and priced in a way that will attract consumers who have continued to be FTA viewers, while minimising the risk of cannibalising their traditional subscriber base. In July 2013, leading UK satellite pay-TV operator BSkyB launched its NOW TV Box at an ‘impulse buy’ price of GBP9.99 (EUR11.71) in order to drive the take-up of its OTT video service, which offers pay-per-day access to its premium sports channel line-up, as well as subscription-based access to its premium movie content.