After peaking in 2016 at $205 billion, and despite the number of pay-TV subscribers projected to rise by 9% over the next five years, global pay-TV revenues are set to fall by 11% to $183 billion by 2023, says a report from Digital TV Research.
The Global Pay-TV Revenue Forecasts report says that the key driver for the decline in revenues per subscriber is due to more homes converting to bundles. It estimates that eight of the top ten countries will lose pay-TV revenues between 2017 and 2023, while revenues will decline in 47 of the 138 countries covered in the report between 2017 and 2023. Twelve countries are set to lose more than 10% of their revenues leading to a total global decline of $19 billion.
Looking at specific territories, Digital TV Research found that US pay-TV revenues peaked in 2015, at $102 billion and forecasts a $22 billion decline between 2017 and 2023 to take its total down to $75 billion. By contrast, China will gain nearly $1 billion in pay-TV revenues between 2017 and 2023 to bring its total to $13 billion while India will provide the largest increase in pay-TV revenues at $1.6 billion. Revenues will more than double for six countries between 2017 and 2023. Eight of the top ten fast-growth nations by percentage increase will be in Africa.
On platforms, Digital TV Research believes that satellite TV and digital cable TV revenues will continue to be broadly similar. Revenues for the former were $83 billion in 2017; falling to $77 billion by 2023 and digital cable TV is set to supply $76 billion in 2023; down from $85 billion in 2023. The Global Pay-TV Revenue Forecasts report rates IPTV as the pay-TV revenue winner, with revenues increasing from $25 billion in 2017 to $27 billion in 2023.
CBS is providing a model for what OTT delivery can be and somehow the rest of the network tv world is missing the boat. This week CBS made a few momentous announcements. One is that CBS All Access is going to become available outside of the US. NBC, ABC and Fox do not have that sort of reach at the moment nor have they made any announcements indicating a plan for it. Hulu, which of course is the easiest way to stream content from those networks without having an authenticated app has grown considerably over the past year domestically but the service is not available to over seas viewers.
It can’t be overstated that a major part of Netflix’s growth has been due to its international reach. What will be interesting is to see if CBS expands its offerings to cover programming that is popular in the regions it expands to or will partner with terrestrial broadcasters overseas to offer live streaming in the same way it does in the US.
Even without international expansion, the network has seen strong results so far. CBS owned Showtime has proven successful as an over the top product as well. CBS says that there are over 4 million subscribers to Showtime and CBS All Access combined, while not on the scale of Netflix and its 128 million plus users, it is solid growth for a relatively new service.
That is not the only thing CBS is rolling out though. It will be launching an OTT sports channel in the same vein as CBSN. Why is that important? Because CBSN is a free 24-hour service. The network is available via its website, apps on a number of platforms as well as through the CBS All Access app. While the news is live, it does not show the actual CBS Nightly News program. Though it should be noted that it did air a 2016 presidential debate live.
The question on the minds of cord cutters, of course, is whether CBS will put live sports on the internet or will it be a free 24-hour sports news network. There are now numerous examples of online operations streaming sports including Facebook’s MLB streaming, Amazon, and the NFL have a pact for Thursday Night Football and Twitter has deals to stream MLB, PGA and WNBA games.
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A study from Digital TV Research has found that 2016 saw an estimated 254 million additional pay-TV subscribers between 2010 and 2016, an increase of 35%, to take the global total to 969 million.
The Global Pay TV Subscriber Databook found that digital cable TV created the most additions by platform – at 256 million between 2010 and 2016 just as analogue cable TV lost 218 million, dampening overall cable gains. There were 76 million extra subs for IPTV to nearly quintuple its total. Satellite TV added 77 million subs and pay-DTT five million. The survey also showed that excluding analogue cable TV, the digital pay-TV market rocketed from 380 million subscribers in 2010 onto 852 million at end-2016.
Looking at regions, the survey found that pay-TV subscriber counts doubled in 53 countries between 2010 and 2016. The Asia Pacific was the world’s largest pay-TV subscriber region, contributing three-fifths to the global total. China supplies about a third of the world’s pay-TV subscribers, with 313 million by end-2016. However, the research also noted that pay-TV subscriber numbers fell in nine countries, with the US down by 4.4 million and Italy by 2.3 million.