OTT v linear satellite TV: the likely outcome

April 30, 2015 08.30 Europe/London By Chris Dziadul

Linear satellite TV is likely to hold its own for the next few years despite the growing strength of OTT. However, in the long-term it will have to make changes.

Quoting the findings of a report by NSR entitled Linear TV via Satellite: DTH, OTT & IPTV, Satnews reports that the linear satellite TV market will see an increase of over 21,000 channels across both DTH and video distribution platforms by 2024. Indeed, the proliferation of Ultra HD, HD and SD channels, along with a limited impact from OTT platforms, will allow for this growth.

Commenting on the findings, Alan Crisp, Analyst with NSR and lead author of the report, said: “Although OTT platforms have become increasingly mature in North America, elsewhere the development of OTT platforms is in its infancy and is expected to have limited impact on traditional video platforms in the short to medium term”.

In North America, subscriber numbers on most cable TV platforms are declining due to cord cutting, and subscriber growth for DTH platforms has been at sub-par levels for some time.

However, elsewhere platforms are moving from strength to strength, with the pull of exclusive content, sports and localised channels being a significant draw for consumers worldwide to linear TV platforms. NSR does not expect this trend to change soon.

Meanwhile, particularly in developing regions, access to high quality and fast internet access remains a bottleneck for the adoption of OTT platforms, with wireless technologies such as 3G/LTE not suited to the demanding bandwidth required for streaming video content. As such, unless a ubiquitous fixed line or low cost satellite broadband service is introduced, traditional pay-TV platforms are unlikely to be strongly impacted.

Leased capacity video will therefore continue to exhibit strong growth, with over 3,500 satellite transponders to be leased in 2024 for DTH and video distribution services globally.

Crisp added: “Nevertheless, longer-term, it will essentially be compulsory for DTH and other pay-TV platforms to offer OTT as a supplementary service, to both increase retention amongst existing subscribers, and signing up new subs based on exclusive content, and effectively becoming a ‘one-stop-shop’ for content as much as feasibly possible”.