Sluggish pay-TV growth expected in Latin America

Pay-TV revenues [subscriptions and PPV] in Latin America will grow by only 9% (or up by $1.6 billion) between 2015 and 2021, according to the fifth edition of the Digital TV Latin America Forecasts report.

Economic woes are one reason for this slowdown, but market maturity is another.

Satellite TV will continue to be the largest pay-TV platform, with revenues reaching $13.1 billion in 2021, up from $12.6 billion in 2015. Cable TV revenues will be $5.6 billion in 2021, up from $5.1 billion in 2015.

Simon Murray, principal analyst at Digital TV Research, said: “Digital cable TV revenues overtook analog cable in 2014 and IPTV will pass analog cable by 2020. IPTV revenues will grow by the same amount as satellite TV and cable TV over this period.”

Brazil ($7.3 billion in 2021) will remain the top country by pay-TV revenues by some distance, followed by Mexico ($3.4 billion) and Argentina ($2.2 billion). These three will collectively take two-thirds of the total for the 19 countries covered in the report. However, revenues will fall in Brazil, Puerto Rico and Venezuela.

Pay-TV penetration will reach 50.6% by 2021, up from 45.0% at end-2015 and 28.7% at end-2010. This means 14 million more pay-TV homes between 2015 and 2021; taking the total to 82 million. This compares to more than 27 million pay-TV subscriber additions between 2010 and 2015.

Brazil will provide 4.7 million of the additions between 2015 and 2021 and Mexico 3.7 million. However, Brazil added 9.6 million new pay-TV subscribers between 2010 and 2015, with Mexico bringing in a further 7.1 million.

Puerto Rico will record 83% pay-TV penetration by 2021, with four more countries [Argentina, Honduras, Panama and Venezuela] above 70%. However, five countries [Brazil, Dominican Republic, El Salvador, Guatemala and Peru] will be below 40%.

Extracting analogue cable, the number of digital pay-TV subscribers will rocket from 19.5 million in 2010 (13.7% penetration) to 52.3 million in 2015 (34.6%) to 80.9 million in 2021 (49.8%).

For more information on the fifth edition of the Digital TV Latin America Forecasts report, please see the Broadband TV News webshop.

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Digital TV homes to double in Latin America

Despite slowing economic growth, the number of digital TV households in Latin America will double by 2020. The Digital TV Latin America Forecasts report estimates 152 million digital TV households by 2020. Digital TV will climb from only 17.9% penetration of TV households at end-2010 to just over the halfway mark by end-2014 and onto 93.6% by 2020.

Central America & Caribbean = Costa Rica, Dominican Rep, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Puerto Rico. Andean = Bolivia, Colombia, Ecuador, Peru, Venezuela. Southern Cone = Argentina, Chile, Paraguay, Uruguay

Source: Digital TV Research Ltd.

From the 19 countries covered in the forecasts, Brazil will add 28 million digital TV households during this time frame, with Mexico contributing an extra 11 million and Argentina nearly 5 million more. Puerto Rico was the first country to reach complete conversion to digital – in 2014. Panama and Uruguay will be the only other countries to reach complete digital conversion by 2020.

Primary FTA DTT will overtake pay satellite TV is the leading digital platform in 2016. The number of primary DTT homes will rocket from 4.2 million at end-2010 to 68.0 million by 2020 (giving 41.9% penetration).

Nearly 10 million pay satellite TV households will be added between 2014 and 2020, taking penetration to a quarter of TV households by 2020. However, much of its fast growth has already taken place.

About 18.2 million digital cable subscribers to be added between 2014 and 2020; taking penetration to a fifth of TV households. Conversely, the number of analog cable subscribers will plummet from 18.0 million to 4.3 million. IPTV will climb from 1.3 million subscribers in 2014 to 6.8 million by 2020.

Brazil ($8.6 billion in 2020) will remain the top country by pay TV revenues by some distance, followed by Mexico ($5.6 billion) and Argentina ($2.3 billion) – collectively taking 71% of the total.

Pay TV revenues in Latin America will grow by $2.6 billion between 2014 and 2020. Satellite TV will continue to be the largest pay TV platform, with revenues reaching $16.7 billion in 2020. Cable TV will bring in a further $5.9 billion. Digital cable TV revenues will overtake analog cable in 2014 and IPTV will pass analog cable in 2020.

Millicom to launch DTH pay-TV in Latin America on Eutelsat

Millicom, the international telecommunications and media company, has selected Eutelsat Americas to support its recent entry into the satellite pay-TV market in Latin America.

Millicom has signed a multi-year contract with Eutelsat Americas for capacity on the Eutelsat 117 West A satellite (formerly Satmex 8) that provides premium Direct-to-Home coverage across Latin America. Millicom also has options for additional capacity and service continuity on the Eutelsat 117 West B satellite (formerly Satmex 9) that will be launched next year and co-located with Eutelsat 117 West A to build up a DTH hotspot over Latin America.

Operating under the Tigo Star brand, the new satellite pay-TV platform complements Millicom’s cable and mobile services and has already been launched in two markets: Bolivia and El Salvador. The Bolivian service addresses the 6.5 million people of Bolivia’s 10.5 million population who live beyond the company’s cable coverage. It comprises 75 channels, including eight in HD, five free-to-air and eight premium services. The DTH service in El Salvador offers customers up to 70 channels, including four in HD.

Commenting on the launch of Tigo Star, Millicom’s Executive Vice-President for Home and Digital Media, Martin Lewerth, said: “The launch of our new satellite-based service on the Eutelsat Americas satellite at 117° West is another significant step in the transformation of Millicom into a diversified digital lifestyle provider. It adds to our cable services and reaches right across Latin America which means we can now broadcast for the first time to communities and households throughout the region.”

Patricio Northland, CEO of Eutelsat Americas, said: “We are delighted that not only is Millicom adding satellite to the range of platforms it is deploying to accelerate availability of digital services in its target markets, but that its preference goes to our EUTELSAT 117 West A satellite for Tigo Star. There is a significant untapped opportunity in Latin America for satellites to extend access to digital and High Definition channels to homes beyond terrestrial networks. Winning the confidence of Millicom, an experienced player, clearly puts Eutelsat Americas on the map and encourages us to deliver the highest levels of service, innovation and creativity so that the 117° West position can take its place as a broadcasting point of reference in Latin America.”

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DTT drives digital TV in Latin America

Digital TV is finally taking off in Latin America – from only 18.1% penetration of TV households at end-2010 to just over the halfway mark by end-2014 and onto 94.5% by 2020, according toa new report from Digital TV Research. To put it another way, 132 million digital TV households (in the 19 countries covered in the Digital TV Latin America report) will be added between 2010 and 2020 to take the total to 157 million. DTT will provide half of the additional digital TV homes to be added between 2010 and 2020.

Latin America TV household forecasts by platform (million)

Simon Murray, Principal Analyst at Digital TV Research, said: “Much of this growth is being driven by satellite TV, especially lower-cost and prepaid packages – although these subscribers are forcing down average ARPU figures.”

Nearly 14.4 million pay satellite TV households will be added between 2013 and 2020, with 3.1 million more in 2014 alone. Pay satellite TV penetration will grow from 9.6% in 2010 to 21.1% by end-2014 and onto 25.8% in 2020 – indicating that much of the fast growth has already taken place.

Pay satellite TV is the leading digital platform, but primary FTA DTT will overtake it in 2015. The number of primary DTT homes will rocket from 4.3 million at end-2010 (3.0% penetration) to 27.1 million in 2014 (18.0%) and onto 71.1 million by 2020 (42.7%).

There are signs that the economic boom may be faltering. The predicted economic slowdown in China has had an adverse knock-on effect for exports in Latin America, especially in countries such as Argentina. US sanctions have hit Venezuela. The positives are that Brazil is hosting both the World Cup (2014) and the Summer Olympics (2016), which will boost infrastructure build-out.

Brazil, Mexico and Argentina dominate the region. Brazil alone will add 37 million digital TV households between 2013 and 2020, with Mexico contributing an extra 15 million and Argentina nearly 7 million more. Digital TV households will also increase rapidly in the other 16 countries covered in this report – collectively adding 34 million digital homes between 2013 and 2020.

Pay TV penetration will rise, but not as dramatically as digital TV penetration. Overall pay TV penetration will reach 53% by 2020, up from 41% at end-2013 and 29% at end-2010. This means 28 million more pay TV homes between 2013 and 2020, taking the total to 89 million. Brazil will provide 11.6 million of these additions and Mexico 6.4 million. Puerto Rico will record 84% pay TV penetration by 2020, with five countries above 70%. However, three countries will be below 40%.

Pay TV revenues in Latin America will be $4.5 billion higher in 2020 ($24.7 billion total) than in 2013. Satellite TV will continue to be the largest pay TV platform, with revenues reaching $17.6 billion in 2020, up from $14.2 billion in 2013. Cable TV revenues will be $6.1 billion in 2020, up from $4.8 billion in 2013.

More: Digital TV Latin America Forecasts