Hungary has been exceptionally hard hit by the global economic crisis and is, according to the EBRD, unlikely to come out of recession until next year. However, as a visit to Budapest showed me earlier this week, its TV industry is bearing up well and indeed largely positive about the future.
Take DTT, for instance. Despite its initial, well-publicized problems, the MinDigTV platform launched in December 2008 is finally starting to make waves. Figures due to be published by its operator Antenna Hungária early next week are expected to show a significant rise in new subscribers following a successful promotional campaign over Christmas.
Given that there is still some 30% unused capacity on MinDigTV, it is perhaps not surprising that Antenna Hungária would like to add more FTA channels to its line-up or indeed a new pay-TV package. However, it also concedes that it may not be easy do so for a number of reasons.
There are also questions marks as to the future of the company’s DVB-H platform, which has been operating on a trial basis for the past 13 months. Without the participation of Hungary’s three mobile operators, it is likely to wither and eventually die.
The global crisis impacted badly on Hungary’s TV ad market in 2009, with revenues slumping by between 15-20%. Prior to that, they had steadily risen by an average of 5-7% a year for several years.
Although the combined audience share of the two national commercial stations RTL Klub and TV2 is around 50%, they claim an even higher 75-80% of total ad spend. While this makes it hard for the large (and indeed growing) number of thematic channels to survive, companies such as Chello Central Europe feel this is no obstacle to their progress. Based in Budapest but supplying such channels to the wider CEE region, it has recently added a Hungarian-focused sports channel named Sport M to its offer.
The incumbent telco Magyar Telekom has meanwhile emerged as a key player, through not only its cable operation (long established and second largest in Hungary after UPC) but also IPTV and DTH platforms, the latter of which has taken the market by storm. However, its biggest problem, as indeed those of its competitors, is that of customer retention in what is an increasingly competitive and price sensitive marketplace.
While consolidation in Hungary’s DTH market is unlikely anytime soon, cable is likely to see some of its small and medium sized operators snapped up by the leading players. FiberNet, one of the top four, plans to play a key role in the process.
