Astra’s latest satellite monitor shows a clear link between available channels and subscriber numbers, writes Julian Clover.
The dominance of flat panel displays in electrical retailers would give the impression that everyone is rushing out to buy HD. It’s true that plasmas and now more likely LCD screens have increased the replacement cycle even if stores are now worried that they are losing momentum. 20% of European homes now at least have a display that is HD Ready representing 37 million such sets sold since February 2005.
According to Christoph Limmer, manager, market development, SES-Astra forecasts on HD Ready sets sold in the European market show that the initial expectations, made only three years ago, are already being exceeded. HD has been key to Astra’s recent strategy, pushing satellite’s advantages in carrying the bandwidth guzzling picture format, but the problem remains converting HD Ready homes into HD actual.
“At year end 2007 there were about one million HD satellite receivers produced for the UK market,” says Limmer. He points to forecasts from Screen Digest and EuroConsult that are expected to lead to a market of 4.4 million HD satellite receivers in place by the end of the year. “The consumer market is now picking up, which leads a great potential for TV broadcasters across Europe and their HD channels.”
Those channels already present in the market are from the big pay-TV broadcasters, Sky, Canal+ and the perennial German laggard Premiere. The new trend is for smaller encrypted broadcasters to join the packages. “Once there is an established base coming from the HD operators the next step is for encrypted HD channels.”
At the end of 2007 there were 100 HD channels broadcast over Astra’s European satellites, though the operator admits the number stagnated during the year, and is only now beginning to pick up. The figure counts channels, not brands, so Discovery Channel would be counted each time it appears with a slightly different feed. Screen Digest is predicting 400 HD channels to be available by the year 2012.
“It’s pay-TV that creates the revenue streams, then the publics follow, because they have the public mandate, then when there is sufficient rate the privates go in because they have to protect their market share,” says Alexander Oudendijk, Chief Commercial Officer of SES. “In Germany ProSiebenSat1 went in early but there was not a whole lot of reach so they didn’t make any money. “
The UK is by far the largest HD market with 422,000 subscribers at the end of December 2007. Premiere has 120,000 HD subscribers, but when free-to-air boxes are included market estimates push this number up to around 250,000. The trouble is that following the withdrawal of ProSiebenSat.1 from the HD field these homes only have a single channel to watch. Canal+ France has 86,000 HD subscribers and around 50,000 other homes can also watch the format.
“You need to have a reasonable base of HD viewers before commercial channels and public broadcasters will invest in HD,” adds Limmer. ”There is a correlation between the number of channels in HD you get and the number of HD channels. So the more HD channels in your bouquet then the more subscribers you attract. “
This is all the more true at BSkyB where its package is nudging 18 channels compared to Premiere’s solitary two. Again the German pay-TV platform has been distracted at the expense of its viewers and ultimately the bottom line.
