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OTT gathers speed in CEE

June 25, 2014 11.38 Europe/London By Chris Dziadul, Digital TV in CEE, Budapest

eastern-europe-mapAlthough Central and Eastern Europe is one of the fastest growing OTT regions globally, it still only accounts for only 1% of global revenues.

According to Ed Barton, practice leader, TV, Ovum, these reached $100 million in 2013 and should rise to around $700m million by 2017, with the ad model helping growth. Barton identified a number of factors as driving growth in the region.

The first was household broadband penetration and proliferation of IE enabled devices. In terms of addressability, the market in CEE is expecting to see the biggest growth in internet-enabled TVs over the next few years, with over 20 million deployed by 2018.

At the same time, the biggest reduction will be seen in traditional TVs.

Another factor driving growth will be the rising availability of services. This holds particularly true in Russia, where the market is vigorous, and in Poland.

Other important factors include increased audience awareness of TV alternatives; increasing usage of non-cash transactions: and increasing number of legislative counter-measures reassuring rights holders. The latter include an anti-piracy law passed in Russia last year.

Looking at OTT revenue composition in CEE, Barton said that advertising accounted for 78% of the total in 2013, with subscription and transaction claiming 17% and 5% respectively. By 2016, the breakdown will be 59%, 33% and 8% respectively.

Barton said that there a question marks as to when Netflix will launch in CEE. However, working with cable operators, which it has already done in the UK (Virgin Media) and Sweden (Com Hem), could drive scale.

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Filed Under: Central & East Europe, Newsline Edited: 25 June 2014 11:38

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