Raking through the first quarter figures of many of the European suppliers of Pay TV systems this week we get a snapshot of just what effect the recession and competition is having on pay TV services across Europe.
It’s a picture more or less consistent with messages we are getting from the US, which is that cable is losing TV customers, but that is for the most part because it is in the midst of two key moves ‘ a shift to digital cable and a move to triple play revenues.
Cable in Europe is perhaps behind its US counterparts, and the noticeable thing in ALL of the quarterly figures we have perused is that rise of broadband lines using mostly DOCSIS 2.0 among freshly digitized customers.
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We haven’t documented it in this table, but most cable operators are still predominantly analog in Europe, and can only add broadband revenues when they have upgraded. This has been taken on as a hurculean task by the private equity groups which have bought and sold all the major European cable operations with the exception of Liberty Global (which is not entirely European, with interests in Japan and South America) and Virgin.
But while cable has concentrated on being profitable by having more money from the same number of customers, IPTV and DTH pay TV services have pillaged their markets, in the last quarter stealing some 129,000 net from the cable figures we have managed to collect.
This is only circumstantial and there are many other cable operators who either do not break out their numbers or who have yet to report, but it is consistent with the US picture.
DTH has slowed to a crawl but all the DTH entries in this table are now controlled by News Corp, which is also exploring ways of adding other services to get it to a triple play. In the UK it has already managed this and has a similar profile to cable companies except that is has managed to squeeze some growth in the number of TV homes.
IPTV on the other hand (in this sample) has grown 7.7% in subscriber numbers (not revenue) while the rest of the economy shrank visibly.
Even among these, British Telecom with its BT Vision hybrid VoD DTT service, has experienced its slowest ever quarter since it was launched. It still appears to have grown 6.3% but this is from a low base and it is far less well established than other European IPTV services. It also reported that it is getting 30 VoD viewings a month from each subscriber.
After all the doubt thrown over Deutsche Telekom during the past five years for its choice of untried Microsoft IPTV software, and for choosing Alcatel ahead of Siemens to do its implementation, it’s Entertain IPTV service seems to have come good. Those numbers with growth of almost 27% and the second largest growth by numbers of any Pay TV service that has so far reported (after Telefonica which already has over 2 million customers across multiple territories) are by far and away the highest by percentage. The rest of Deutsche Telekom’s results made pretty poor reading, but this was one of its few bright spots.