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Cable grows revenues as Netflix makes presence felt

March 8, 2017 10.07 Europe/London By Julian Clover, Cable Congress 2017, Brussels

Independent analyst Ben Keen delivers the numbers

Cable revenues are holding up despite pressure from OTT platforms and an accompanying content arms race.

Presenting the annual analysis of the cable sector by IHS Markit, the now independent analyst Ben Ken, showed that pay-TV subscriber numbers had fallen in both western and eastern Europe.

However, broadband continues to be cable’s saviour, steadily increasing the ARPU (average revenue per unit) as speeds rise.

118.24m Revenue Generating Units or 2.7m RGUs added (Cable Europe/IHS)

“The overall revenue per user keeps climbing up, now €24, and we’re going to see it climb higher for those that offer mobile too,” said Keen. “The value of the cable customer is being recognised by the amount of M&A activity”.

More than 2.7 million Revenue Generating Units (RGUs), the industry metric for the total sum of TV, internet and telephony subscriptions, were added in 2016, and the total across Europe is now 118.24 million.

Total revenues €23.45bn – over €1bn in revenue added since 2015 (Cable Europe/IHS)

But it is in video where the market is shifting, as Netflix and Amazon begin to overtake incumbent content providers. Only in France, Russia and Poland do online video players not appear in the Top 5 video ranking.

In the UK, Netflix’s 6.03 million subscribers is second only to Sky’s 10.74 million; in Germany Amazon on 2.76 million is behind just Unitymedia and Vodafone.

“They are becoming part of the major subscription landscape and it’s good news because customers have an appetite to pay for subscription video.”

Keen described a content arms race that allowed the global players to invest internationally – though increasingly with local commissions – outranking the expenditure of the incumbents who themselves are increasing investment.

And ultimately it is the traditional operators that are taking the bulk of revenues from an expanded pie.

Cable Subscribers 2016 at a Glance

Total Cable Unique Homes:0.004 64.44m(64.17m in 2015)
RGUs:0.023118.24m(115.53m in 2015) => 2.7 million RGUs added
Broadband subscribers0.05935.62m(33.62m in 2015)
Telephony subscribers0.036 27.75m(26.78m in 2015)
TV subscribers-0.005 54.87m(55.12m in 2015)
Digital TV subscribers0.063 36.40m(34.23m in 2015)
Analogue TV subscribers-0.116 18.47m(20.89m in 2015)
66.3% of TV subscribers are now digital

(Cable Europe/IHS)

Cable Revenues 2016 at a Glance

Total cable revenues0.046 €23.45bn(€22.42bn – 2015)€1bn revenues added
Broadband revenues0.075 €7.70bn(€7.16bn – 2015)
Telephony revenues0.021 €4.83bn(€4.73bn – 2015)
TV revenue0.037 €10.91bn (€10.52bn – 2015)
Digital TV revenue0.085€8.26bn (€7.61bn in 2015)
Total VOD revenue0.141€462m (€405mn in 2015)
Analogue TV revenue-0.127€2.19bn (€2.51bn in 2015)
80% of TV revenues are DIGITAL (includes VOD)

(Cable Europe/IHS)

 

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Related

Filed Under: Cable Congress, Editor's Choice, Newsline Tagged With: Cable Congress Edited: 9 March 2017 08:09

About Julian Clover

Julian Clover is a Media and Technology journalist based in Cambridge, UK. He works in online and printed media. Julian is also a voice on local radio. You can talk to Julian on Twitter @julianclover, on Facebook or by email at jclover@broadbandtvnews.com.

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