After years of being battered by inclement economic times, Eastern Europe's digital TV market is emerging as a stronger entity, says a report from Digital TV Research.
According to The Digital TV Eastern Europe report, digital TV penetration crossed the halfway mark of TV households in 2012, up from a third two years earlier and at the current rate will amount to two-thirds by the end of this year and 98.5% by 2020.
Of the 21 countries covered in the report, 13 will be completely digital by 2020 taking the lead of Estonia, the first to full conversion in 2012. From the 83.6 million digital TV homes to be added across the region between 2010 and 2020, Russia is set to contribute 40.7 million, with Ukraine increasing by 13.3 million and Poland 6.7 million.
In absolute terms, the number of digital TV homes will have tripled between 2010 and 2020; up from 41.0 million to 124.7 million. In the key paid-for sector, the number of digital pay-TV subscribers will have increased from 26.1 million (21.5% of TV households) in 2010 to 45.0 million (36.6%) in 2013 and to 73.6 million (58.2%) by 2020. Of the 52.3 million digital TV homes it calculates that will be added between 2013 and 2020, DTT is forecast to supply 24.9 million, digital cable 15.3 million, IPTV 6.6 million and pay satellite TV 5.8 million.
Looking at the business generated by the increased number of households, Digital TV Research predicts that pay-TV revenues in Eastern Europe will be 48% higher in the ten-year period to 2020 to $7.305 billion. Digital cable and IPTV revenues are set to more than double between 2013 and 2020, but satellite TV revenues, the mainstay of the industry, will likely only grow by 22% over the same period. Russia is expected to contribute $2.02 billion (28%) of the pay-TV revenues in 2020 — overtaking Poland in 2015 — and be responsible for nearly half of the region's $1.1 billion additional pay-TV revenues between 2013 and 2020. Russian TV ARPUs, traditionally very low, are set to increase.
Commenting on the trends revealed, report author Simon Murray. said: "With the proportion of terrestrial homes settling, much of the emphasis from pay-TV players has fallen on the 27.5 million remaining analogue cable subscribers. Many of these homes will upgrade to digital cable, but some will shift to IPTV and satellite TV. However, many of the remaining analogue cable subscribers are refuseniks, who don't want to pay more for TV services. As time goes on, the proportion of the remaining analogue cable homes with this attitude increases. Free-to-air DTT (or even pay DTT) is an attractive option for these homes."