Viewers to double up on pay-TV subs as premium sports value soars

Editor | 15-01-2014

Pay-TV providers should not spend the next year worrying about cord-cutting, and sports broadcasts are set to be hot news throughout the coming year, new research from Deloitte is suggesting.

In its 13th predictions report for the media sector looking at trends for 2014, the technology, media and telecommunications (TMT) practice at Deloitte predicted that in the UK, between one million and 1.5 million homes will subscribe to two or more pay-TV providers by the middle of 2014 while the value of premium sports broadcast rights worldwide will increase to 16 billion, a 14% rise year-on-year.

Deloitte predicts that by the end of 2014 up to 50 million homes around the world will have two or more separate pay-TV subscriptions with these additional subscriptions generating about 3 billion in revenues. The analyst adds that over the coming years, the number of households with multiple pay-TV subscriptions should continue rising, as more content owners and aggregators, including platform owners such as cable and satellite providers, make their content portfolios available via subscription video-on-demand (SVOD).

The result, expects Deloitte, will be that most households will have just two pay-TV providers, most typically a platform-based service and an SVOD, but about 10% of homes with multiple subscriptions will have three or more providers. By end 2015, the analyst believes that this proportion may rise to 20% in selected markets, as more rights owners make their content available via video-on-demand, as broadband speeds increase, and premium programing is increasingly used as a customer retention tool.

"Deloitte predicts at least one million homes by mid-2014 will have two or more separate pay-television subscriptions. It could rise to 1.5 million by year-end if new providers launch dongles," commented Ed Shedd, head of Deloitte's UK technology, media and telecommunications practice. "A further ten million homes will receive premium programming as part of their subscription to another service, such as broadband."

In the broadcast sports rights arena, Deloitte expects the rising value of premium sports broadcast rights worldwide to be driven by new agreements with certain top tier European domestic football leagues and major North American sports leagues. The double digit growth compares to average growth of 5% between 2009 and 2013, and exceeds the forecast 4% increase in global pay-TV revenues for 2014.