IPTV overtakes pay satellite TV in Western Europe

The number of homes paying for IPTV in Western Europe overtook pay satellite TV ones in 2015. According the Digital TV Western Europe Forecasts report, IPTV subscriptions will climb by nearly 7 million (up by 27 per cent) between 2015 and 2021. IPTV revenues will reach $5.77 billion in 2021 – up by $1.2 billion.

However, the number of homes paying for satellite TV will fall by 300,000 between 2015 and 2021 for the 18 countries covered in the report. This mainly results from some operators, especially in Spain and Italy, converting their DTH subs to more lucrative bundles on their broadband networks. Satellite TV revenues will fall for every year from 2011 – and will decline by $1 billion between 2015 and 2021.

Western European pay-TV is fast maturing, with penetration only forecast to grow from 56.8 per cent at end-2015 to 59.5 per cent in 2021. The number of pay -TV subscribers will climb from 97.4 million in 2015 to 104.3 million in 2021.

So, pay-TV subscriptions will only increase by 6.9 million (7.0 per cent) between 2015 and 2021. However, the number of digital pay-TV subs will increase by 19.0 per cent (nearly 17 million) over the same period. Digital cable subs will increase by almost 10 million.

The 9.9 million analogue cable homes remaining at end-2015 will be the hardest to convert to digital as many of these subscribers pay for very basic packages as part of their rent.

“The remaining analogue cable TV subs are the most obstinate,” advised Simon Murray, Principal Analyst at Digital TV Research. “These homes have had several years to transfer to digital platforms – including those from their existing operators, but are still holding out. When conversion finally happens, these homes are more likely to convert to free-to-air platforms such as DTT or satellite than their predecessors.”

In fact, only seven (Finland, France, Iceland, Italy, Norway, Spain and the UK) of the 18 countries covered in the report had fully converted to digital by end-2015.

By 2021, pay-TV penetration will range from nearly 100 per cent in the Netherlands to 36 per cent in Italy. Eight countries will exceed 90 per cent pay TV penetration in 2021. However, pay-TV penetration will fall in Germany, Netherlands, Norway, Sweden and Switzerland – countries with a large number of legacy analogue cable subs.

Despite the number of pay TV-homes increasing, pay TV revenues will remain flat at around $31 billion. The UK ($7.217 billion) will remain the most lucrative pay-TV market. Regardless of having the most pay-TV subs by some distance, Germany’s pay-TV revenues will remain a lot lower than the UK – at $4.183 million by 2021. In fact, France and Italy will not be too far behind Germany, despite having far fewer pay-TV subs.