Fast IPTV subscriber take-up expected but where’s the money?

RELEASED 21/11/2008. Strong growth will result in 57 million IPTV homes by 2013 – or triple theend-2008 figure, according to a new report from Informa Telecoms & Media.Despite this acceleration, only 4% of the world’s TV households areforecast to subscribe to IPTV platforms by 2013. In fact, IPTV: A GlobalAnalysis – 4th Edition states that only 14 countries will have more than 1million IPTV subs.

Report author Simon Murray said: “This fairly limited penetration comesfrom having to migrate subscribers away from long-established cable and DTHservices, as well as the impact of DTT to a lesser extent. However, thereare examples of IPTV gaining a foothold even in the most competitivemarkets.”

In the short term, Informa Telecoms & Media forecasts 18.6 million IPTVhouseholds by the end of 2008, up 8 million in the year. Asia Pacific andWestern Europe are each responsible for nearly 3 million of the additions,with North America adding 1.7 million. However, the global figure representsjust 2% of TV households.

Much of the future growth is expected to be in Asia Pacific. It will becomethe largest region by 2010. By 2013, Asia Pacific will contribute 22.2million of the 57.0 million global total. China alone will have crossed the10 million mark.

The US won’t be too far behind China, which may surprise some given thehigh cable and satellite penetration in the States. However, IPTV operatorshave already scored considerable success, winning with their attractivetriple-play packages and the traditionally fraught relationship betweenconsumers and the cable operators.

France will remain Europe’s leader, but growth is expected to slow incoming years as IPTV concentrates on urban areas. France will have 4.9million IPTV homes by 2013, up from 3.6 million in 2008.

Hong Kong will remain the top country for IPTV penetration of TV households,thanks many to the inroads made by market leader PCCW. PCCW enjoyed rapidtake-up by offering subscribers a la carte channel options and monthly –rather than annual – contracts. PCCW has also taken advantage of the slowreactions of established cable operator I-cable.

However, the company is now encouraging subscribers to invest in longer termpackages to increase revenues and reduce seasonality of revenues (forexample, turnover falls when the European soccer seasons end).

More than a third of Hong Kong’s TV households receive IPTV signals.Although the growth is slowing, half its TV households will take IPTV by2013. Hong Kong will remain way ahead of the next country.

By 2013, Singapore will be second, with 20% IPTV penetration. Singapore’smarket bears similarities to Hong Kong as SingTel battles against theestablished cable operator StarHub Cable Vision. Taiwan will be just behindSingapore with 19% penetration.

France will be in third place with 18% penetration, just ahead of theNetherlands and Belgium – both of which are heavily cabled, but the IPTVoperators have introduced attractive enough packages to win subs over.

By 2013, IPTV penetration will be higher than 10% of TV households in 12countries. However, 14 countries covered in our forecasts will recordpenetration of 2% or less. Latin America will record low rates, mainly dueto the slow start of IPTV in much of the region.

The 200-page report IPTV: A Global Analysis – 4th Edition is published byInforma Telecoms & Media. Informa Telecoms & Media produces a wide range ofmedia business publications, including a market-leading portfolio ofregional TV reports – including Asia Pacific TV, Americas TV, Middle East &North Africa TV and Eastern European TV.