Eastern European pay-TV says 'show me the money'
Joseph O'Halloran
| 05 October 2014
New research from Ovum has revealed that more than half of the Eastern European TV region's homes have signed up to pay-TV services.

ovumThe analyst believes the high number of recent low-cost pay-TV service launches have stimulated the market to such an extent that that the region's TV business can be described as entering 'a dynamic new growth phase'. Indeed in its report , Ovum forecasts that the regional pay-TV market is putting behind its traditional gating factors, such as piracy, and forecasts that, annual revenue in the region will be worth nearly $11 billion by 2019.

"Piracy and low levels of disposable income have been holding back the TV business in Eastern Europe for years," commented Adam Thomas, Ovum's lead analyst for global TV markets. "But the subscriber scale generated by these new services is now being exploited by the rollout of more sophisticated TV services. The trend we have found is a focus towards monetisation and away from purely growing subscriber numbers.

"Even in territories like Ukraine and Slovakia, where pay-TV subscriber growth is limited, Ovum's research has found significant revenue growth. This is likely to be replicated across the region with operators working creatively to generate incremental revenue from existing clients by improving both content and service delivery."

The analysis pinpoints Russian satellite service provider Tricolor is one of the shining examples of growing companies, illustrative of a wider trend within the region's pay-TV sector. It predicts the company will maintain revenue growth by offering subscribers premium services such as movie and HD channel bundles, which should maintain healthy ARPU growth over the next few years.

Ovum adds that the years of numerous, new low-cost service launches are now in the past and, with the market now maturing, Ovum forecasts that ARPU levels, which had been experiencing an on-going decline, will now enjoy consistent growth throughout the forecast period from $9.07 per month in 2013 to $9.90 in 2019.

"Ovum believes that the subscriber scale generated by these low-cost initiatives is now ripe for exploitation via the rollout of more sophisticated TV services," Thomas added. "With the focus moving towards monetisation and away from growing subscriber numbers, Ovum forecasts that pay-TV growth will be steady rather than spectacular going forwards and will reach 61% of TV homes by 2019."