Pay-TV on a down slope in France

Pascale Paoli-Lebailly | 03-12-2012

The French pay-TV market has undergone a significant loss of subscribers, with a total fall of 25,000 households over the past five years.

According to a study monitored by Enders Analysis on behalf of French association ACCES, pay-TV has lost three points in penetration owing to the growth of overall subscribers during the period. The report highlights that the Canal+ and Canalsat bouquets lost over 550,000 subs, while Numericable saw 400,000 subs moving from pay-TV to triple-play offers.

Analysing the causes, the study forecasts the growth of digital FTA theme channels had an impact while IPTV and triple play give people the idea that television is free. But paradoxically, though IPTV has strongly developed subscription TV (7.7 million households in 2009 and 12.8 million at Q2 of 2012), the growth has not benefitted the theme channels.

Enders Analysis indicates that even though pay-TV must face the arrival of OTT players and diversified competition, its model remains a strong one worldwide if it continues to invest in original content. The study gives as examples Canal+ which created its label Création originale and Sky which doubled its production investment from £262 million in 2010 to £523 million in 2012.

The study also encourages broadband suppliers to invest more in the development of theme channels in order to secure their own market in the face of the upcoming competition with OTT giants. "Up to now, only Netflix and Amazon have reached critical sizes, without threatening the pay-TV model" the study states.

In France, Amazon is due to follow its US strategy and launch its VOD offer to its Amazon Premium subs in March 2013 via its LOVEFiLM subsidiary. The number of subscribers should be between 500,000 and one million.

As for Netflix, and owing to losses suffered in UK where first profits will rise in 2014, the study doesn't plan its arrival in France within the next two years.