“Between 2021 and 2027, 86 countries will add Pay TV subs and 52 countries will lose subscribers. Most of the countries gaining Pay TV subscribers are developing nations, with low ARPUs. The US will be the biggest loser – down by 12 million subscribers,” according to industry analyst Simon Murray.
Such a scenario in the advanced markets is leading the Pay TV and Broadcasting players to lean towards the vacuum created by cord cutting in the emerging markets. In this context, Magnaquest had recently conducted a webinar, with rich and insightful inputs from market experts on “How to Make the Most of Pay TV and Broadcasting Growth in the Emerging Markets”.
Here in this blog, we uncover the key tenets of the webinar in a reasonable depth.
The Sweet-spot for Pay TV: The Emerging Economies
Countries like China, India, and Indonesia are bucking the trend by increasing penetration of Pay TV in rural households, which has resulted in the overall industry growth. On the other hand, prominent Cable TV operators such as AT&T, Inc., Comcast Corporation, and DirecTV have detected a massive decline in subscribers as they swap to other media streaming platforms.
The Asia Pacific Pay TV sector is the most dynamic globally, with subscriber figures advancing by 26 million over the next five years. Pay TV penetration will dwell at 66% of the TV households.
The Growth-Contributing Factors:
Access to High-quality Content:
During the severe phase of the pandemic, there was an explicit rise in the number of subscribers of OTT platforms. What explains the increase in Pay TV numbers in many of the emerging markets is the power to access high-quality content from various service providers on a single platform at reasonable costs.
Further, Pay TV service providers now deliver many other value-added services. These include personalized channel subscriptions, lowered subscription charges, internet connectivity, gaming options, TV shopping, and bundled plans based on the users’ demands. Hence, such an eclectic service band offers service providers profit-churning opportunities.
The IPTV Element:
The Asia Pacific region grasped over 25% revenue percentage in 2020. IPTV has been the major growth factor for this region due to users’ quick online subscription business model adoption.
Likewise, the growing Pay TV penetration in rural households in China, India, and Indonesia has led to the overall industry growth. India and China will contribute to 81% of the region’s Pay TV subscribers by 2027. India will add 11 million subscribers between 2021 and 2027, while China will chip in about 5 million. Clearly, OTT penetration will stay much more elevated in China.
Fresh initiatives by federal organizations, such as the Telecom Regulatory Authority of India (TRAI), let the users personalize their choices and spend on channels based on their requirements.
The Reflective Impact and the Way Forward:
While the international Pay TV market is ready to boost subscribers in the forthcoming years, revenues are estimated to drop as operators seek to remain competitive with cheaper streaming services.
The Pay TV technology has developed extensively in the past few years, as did the changing consumer behavior and the availability of digital alternatives. For example, Pay TV service providers now offer additional interactive services such as TV shopping, video-on-demand, gaming, and multi-room charging.
Therefore, going for a Multi-play mode for Pay TV will furnish business opportunities and new solutions. There is also a need to upgrade from legacy systems to more agile and digital Broadband and Pay TV recurring billing software to stay competitive in the market, with consistent up-gradation and upscaling.