A report from Digital TV Research predicts that the year 2013 will be a very good year for pay-TV revenues in North America. It will also be the point from which revenues subsequently drop off almost US$91 billion to US$88.2 billion by 2017.
Pay TV revenues in North America will peak in next year, before gradually falling by US$2.6 billion to reach US$88.2 billion in 2017, according to a new report from Digital TV Research. The Digital TV North America report concludes that TV ARPU is being forced down as cable operators and telcos convert their subscribers to dual-play or triple-play bundles, though blended ARPU is rising.
Report author Simon Murray said: “Pay TV penetration has almost reached saturation point in Canada and the US, so pay TV operators continue to fight between themselves solely to capture analog cable subsscriptions for new subscribers.”
Despite no movement in the penetration figure, the number of pay TV subscribers will climb by 9 million between 2011 and 2017 to 120 million.
Digital penetration was 86% at end-2011, and will reach 100% by 2016. Of the 25 million digital homes to be added between 2011 and 2017, 13 million will come from cable, 7 million from IPTV and 4 million from DTH.
DTH (US$40.7 billion) will become the largest pay TV platform earner in 2017, by overtaking cable (US$40.0 billion). DTH revenues will climb by US$3 billion between 2011 and 2017, with overall cable revenues falling by nearly US$8 billion. Analog cable revenues will fall to zero by 2016, down from US$7.3 billion in 2011 and US$18.6 billion in 2007.
The number of pay DTH households will increase by 3 million between 2011 and 2017 to reach 39.8 million. However, DTH penetration will not change too much, settling at 28.9% by 2017.
There will be 65 million cable homes which all digital by 2017, similar to the 2011 figure (of which 13 million were analog). Cable penetration will be 47.1% by 2017, down from 50.3% at end-2011.
Although most analog cable subs will convert to digital cable, IPTV will also benefit, especially considering the aggressive pricing policies undertaken by the telcos. The number of homes paying for IPTV will climb by 73% between 2011 and 2017 to reach 15.8 million – or 11.5% of TV households. IPTV revenues will increase by a slightly higher rate to achieve US$7.6 billion by 2017.
The operators are coming at this from multiple angles as they push digital penetration to 100 percent by 2016 (from 86 percent in 2011). Most analog cable subs will, of course, just migrate to digital cable but "IPTV will also benefit, especially considering the aggressive pricing policies undertaken by the telcos," the report said.