Sky sees best growth in 11 years

Sky Group has seen its highest third quarter growth in the UK and Ireland for 11 years and the best on Italy for three years.

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Announcing its results for the nine months to March 31, 2015, the company said Germany and Austria had also seen a record growth rate (see separate story).

A total of 242,000 new customer additions were made in the first three months of the calendar year, delivering a 5% increase in group revenue to £8,453 million and a 20% increase in operating profit to £1,025 million.

The UK & Ireland brings 11,877,000 retail customers; Germany & Austria 4,225,000 and Italy 4,746,000 to make a total subscriber base of 20,848,000.

Jeremy Darroch, Group Chief Executive, said that five months after the integration of Germany and Italy into the UK business, integration plans were progressing: “The UK and Ireland delivered a stand-out performance, reporting both the highest customer growth and lowest churn for eleven years. We took share in broadband and grew strongly in TV as our dual-brand strategy with NOW TV and Sky continues to deliver. At the same time, Germany enjoyed another record quarter of growth and Italy posted its best Q3 customer growth in three years. We’ve also delivered significantly increased customer loyalty in each of our businesses.”

Part of the success rests with building additional businesses around the core offering. Among these Sky Store has now seen more than half a million customers purchase one or more movies from Sky since the launch of the service.

NOW TV has witnessed subscriber growth up 30% on the same period last year; sports transactions have trebled with over 1 million year to date and include a record 36,000 on the day of the Liverpool vs Manchester United clash in March.

Sky Deutschland adds 103,000 subscribers

German pay-TV broadcaster Sky Deutschland has acquired 103,000 new subscribers in the first three months of 2015, increasing its total customer figure to 4.23 million.

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In the same period last year, 64,000 subscribers were added.

The turnover grew by €35 million to €455 million. The main growth driver was the income generated through subscriptions which rose by 9% to €419 million.

The EBITDA increased by €31 million to €22 million, thus returning to the black. The expenses without write-offs rose by 1% to €433 million, mainly due to higher costs for the Bundesliga and programming.

Sky, however, didn’t reveal its net result. In the first three months of 2014, the pay-TV company recorded a net loss of €53 million. “We don’t publish the net result separately anymore because of the simplified reporting duties that now apply to us,” a Sky spokesman told Broadband TV News.

OTT TV Market to increase fourfold

Subscriptions from OTT TV providers such as Netflix and Amazon Prime will generate $31.6 billion by 2019, up from just under $8 billion in 2014, according to Juniper Research.

Continued growth in the established markets of West Europe and North America, along with the emergence of key OTT players in the Far East and Asia Pacific, will bring a surge in the uptake of OTT subscriptions over the next four years.

The new research, Mobile & Online TV & Video: OTT, IPTV & Connected Markets 2015-2019, observed that OTT services are seeing a rapid uptake by consumers who want to view content, when and where it suits them. The report argued that traditional broadcasters are facing increased competition as more services go over-the-top of pay TV incumbents, allowing distributors such as Sling TV to provide customers with a cheaper, tailored alternative to cable TV, driving the trend for ‘cord-cutting’.

Whilst key players such as Netflix and YouTube have launched 4K (ultra-high definition) services, the adoption of 4K content has been slow thus far. Juniper is predicting this to change over the next 2 years. Netflix added its 4K offering to its highest priced subscription package last year, showing belief that consumers are willing to pay for higher quality content, while OTT providers are gaining recognition as being the first to supply viewers with content in this new format. Meanwhile, 4K TVs will continue to become more affordable, accelerating hardware take-up.

Other key findings include: over 84% of OTT subscriptions will be made via connected TVs by 2019. IPTV revenues are set to more than double between 2014 and 2019, rewarding Network Operator’s investment in Triple and Quad-Play Services.

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.

Samsung 2015 SUHD TV range arrives in Australia with free six-month Netflix

Samsung has announced the pricing for its new range of SUHD TVs in Australia. Early customers of the 2015 range of SUHD TVs will also be getting six months of free Netflix.

According the South Korean electronics giant, the latest SUHD TVs use nano-crystal technology, offering crisp and clear images. The new range of ultra HD TVs run on Tizen operating system. Samsung says that its new OS will play a major role in Internet of Things.

“The Samsung SUHD experience will change the way Australians think about Samsung’s home entertainment and visual display technology – it’s on a completely new level to anything we have ever produced.” said Philip Newton – Corporate Vice President, Samsung Electronics Australia. “By pushing Samsung’s boundaries in colour and picture quality, the SUHD TV range showcases our continuous commitment to innovation in the TV category, offering Australians an outstanding viewing experience”

Samsung Series 9 JS9500 65-inch SUHD TV is priced at RRP AUD9,999 and will be available from April 2015 while the Series 9 JS9500 88-inch SUHD TV is at RRP AUD24,999, available June 2015.

STB-less pay TV expands to MEA with recent CAM launches

STB-less pay TV expands to MEA with recent CAM launches

Sub-Saharan pay DTT provider GOtv has deployed CI+ Conditional Access Modules (CAMs), enabling its channels to be viewed on compatible integrated digital TV sets without the need for a set-top box (STB). The deployment is currently limited to GOtv’s Kenyan and Ghanaian operators, but could be expanded to the remaining six countries of its pay DTT network.  Go TV’s announcement follows a similar launch in the MENA region by the satellite operator My-HD earlier this year. GOTV has branded its CAMs as ‘GOcard’, and they are being provided by French vendor Neotion. CAMs enable pay TV content to be viewed directly on a television set, without the help of a set-top box (STB) provided the TV set has a digital tuner (iDTV) and a DVB-common-interface (DVB-CI) slot, also known as PCMCIA slot.

Our take
The impact of CAMs on pay TV STB shipments has been geographically constrained to Europe, but these MEA launches could lead to further declines in EMEA STB demand. CAM modules have been eating into STB sales in Europe significantly since the introduction of the more secure CI+ standard in 2009; CAM shipments in Europe as a proportion of region’s total digital pay TV receivers grew from 2% in 2009 to 7.1% or 5.3 million in 2013. Europe is the only market currently suited to significant CAM usage because it the only market with a large installed base of CAM compatible TV sets.  This is the result of a 2002 EU mandate for the inclusion of DVB-CI slots in all TV sets with digital TV tuners and screen diagonal >30cm, which combined with the migration to DTT broadcasting drove the installed base of compatible TVs to grow from 9 million in 2002 to 412 million in 2013.

Despite strong growth between 2009 and 2012, CAM growth did start to slow down in 2013 primarily due to changing market dynamics and CAMs technical limitations. CAMs can neither route nor decrypt IP-delivered content, nor can they handle multi-stream reception. This means that features such as multi-channel DVR and almost all IP-reliant services remain unsupported. This may not have been a drawback for CAMs a decade ago, when TV was largely linear and less interactive, but markets such as Europe have since evolved. Established pay TV markets such as Western Europe have reached a stage of saturation where Pay TV providers have to rely on advanced services to stay competitive and boost ARPUs. These services include IP VoD, multiscreen, DVR and cloud-based offers. Since CAMs cannot fully support these services, operator CAM deployment remains confined to supporting the most basic experience; the delivery of linear digital channels alone.

Emerging markets such as the Middle East and Africa (MEA) are still largely focused on delivering the basic digital pay TV needs of the end user. This means that CAMs technical limitations are not yet an entry barrier for these markets. Instead, the main barrier to entry is the general lack of availability of compatible TVs. Government mandates for CAM compatibility in digital TV sets are currently absent, but would be a key driver. However, the presence of multi-national pay TV operators in MEA can also be an appeal for TV manufacturers looking to introduce CAM compatibility in their products. TV manufacturers like to produce sets that can be sold across – an entire region rather than a specific country, for production efficiency. Due to low margins on TVs, manufacturers avoid the inclusion of extra functionality like DVB-CI, as it adds to BOM costs. Therefore, it makes little or no economic sense for TV manufacturers to introduce DVB-CI to serve a single operator in a single country, but if that operator is present across an entire region sufficient scale could be achieved. The presence of multi-national operators like GOtv and MyTV in MEA potentially offers this scale. This means that if TV manufacturers launch a specific product for such an operator, it could be scaled out to multiple operations. Chinese vendor Hisense has already launched a CAM compatible TV product for GOtv in Ghana and Kenya, which also is likely to be rolled out to GOtv’s remaining 6 countries soon. MEA is also a price-competitive pay TV market – where demand for premium features such as smart TV and UHD is not generally high. Making TVs compatible with CAM can serve as a differentiator for TV manufacturers looking to stand-out in such a market.

MEA is an important market for the future growth of CAMs and also for STBs. From a STB perspective, MEA will be the third largest growth market for pay TV STB shipments after Eastern Europe and Latin America. STB makers may not currently see CAMs as a big threat in emerging markets because it is currently limited in these regions by the general lack of compatible host devices. Should a future government mandate be placed, or should pay TV CAM availability encourage TV manufacturers to introduce compatible products in the region, as many Chinese companies including TCL and Hisense are already looking to do, this threat can potentially impact STB growth as it has in Western Europe.

Megafon acquires Internet and cable TV provider in Western Siberia--Dec 13, 2011

MegaFon, a major Russian mobile operator, made a further step last Friday towards business diversification and regional expansion by acquiring Yugratel, a broadband Internet and cable TV provider operating in the Khanty-Mansiysk Autonomous District of Western Siberia.

Yugratel was sold through an auction sale by the local authorities for 2.4 billion rubles, or approximately $76 million.

Yugratel is a relatively small player in the region, with 28,000 customers, or 11% of the local market, far behind Rostelecom’s 49% market share. But Yugratel enjoys a healthy financial situation with a net profit amounting to 129 million rubles, or $4.1 million in 2010 along with a good future earnings potential, the Russian online publication ComNews.ru quoted experts as saying.

The Russian antimonopoly authorities did not allow Rostelecom, Russia’s national telecom operator, to take part in the auction.

MegaFon, which has ambitions to become a ‘universal telecom operator,’ has made some notable acquisitions over the past few years. Among the most recent ones, earlier this month, was Luchshe.net, a broadband operator that provides services in Kursk under the SVOЁ trademark.

In November, the company announced the acquisition of broadband Internet access providers Internet Center and Svyazinform, which serve more than 60,000 customers in Chuvashia under the Chebnet brand.

In June, Megafon acquired St. Petersburg Internet provider Web Plus, and NetByNet, a fixed broadband Internet, digital TV and IP telephony operator operating in Moscow and a number of regions.

In 2010, MegaFon acquired Synterra, a company with a large terrestrial and satellite telecommunications infrastructure.