Subscription and pay per view (PPV) revenues for 522 operators around the world will remain flat at around $185 billion, despite the addition of 120 million subs between 2016 and 2022.
Digital TV Research’s Global Pay TV Operator Forecasts report estimates 30 pay TV operators earned more than $1 billion in 2016.
Yet the revenue share for the top 10 operators will fall from 55% in 2016 to 51% in 2022.
The share of the top 50 operators will fall from 75% in 2016 to 73% in 2022.
The US dominates the top 10, with AT&T in the lead both in 2016 and forecast to be number one still in 2022.
Principal Analyst at Digital TV Research Simon Murray spoke to IBC 365 about why revenues are staying flat: “North America and a few – but not many - other countries are experiencing cord cutting.
“Revenues are also falling because people are opting to buy double play or triple play bundles, which means higher overall revenues for the operator, but lower TV revenues than standalone packages.
“In some countries, subscribers are being more selective in their channel choice; fewer premium subscribers and popularity of skinny packages.”
However, he added: “On the plus side, there is still plenty of room for pay TV subscriber growth, especially in emerging markets in Asia and Africa.”
Murray continued: “As global revenues are flat this can mean only one thing: the top operators will lose revenues. In fact, 114 of the 522 operators will lose TV revenues between 2016 and 2022.”
Murray commented on how those operators can potentially claw back the missing cash: “Apart from converting subscribers to bundles, operators provide value-added services. These include on-demand platforms (maybe in partnership with someone like Netflix), HD packages, fancy home gateway set top boxes, and TV everywhere.”
Subscriber increase
Pay TV subscriptions for the 522 operators will increase from a collective 839 million in 2016 to 963 million by 2022.
These operators took 87% of the 959 million global subscribers by end 2016, with this level expected to inch up to 88% of the 1,093 million total by 2022.
A total of 28 operators will add more than one million subscribers.
The Asia-Pacific region will dominate the ranking of operators by subscriber gains between 2016 and 2022, taking 13 of the top 15 places. Only 93 of the 522 operators will lose subscribers between 2016 and 2022.
Meanwhile, global pay TV revenues will peak in 2017 at $202 billion.
However, no rapid decline will take place after 2017 as revenues will still be as high as $200 billion in 2022.
Covering 138 countries, the Global Pay TV Revenue Forecasts report from Digital TV Research concludes that revenues will fall in North America by a huge $12 billion, Western Europe will be down $566 million and Eastern Europe but only by $28 million between 2016 and 2022. Revenues will decline in 33 countries between 2016 and 2022.
Despite its rapidly falling revenues, North America will still command 47.5% of global pay TV revenues – or $94.82 billion - in 2022, although this is way down from the 58.3% recorded in 2010.
On dramatically falling revenues in North America according to the Global Pay TV Revenue Forecasts report, Murray explained to IBC 365 exactly what is causing the problem in the US, and why is that problem not affecting other regions as badly.
He said: “Cord-cutting is a major problem in the US, but it won’t be such a problem elsewhere as the US market is far more mature than any other country. Also US subscription fees are higher than most other countries in the world.
“Furthermore, US cable operators have traditionally had poor relationships with their subscribers in terms of customer service, although this is not as big a problem as it once was.
”US consumers have also been willing to pay for multiple online platforms, which diminishes the value of their traditional pay TV offers,” he concluded.
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