Affordability behind continued pay-TV growth in LATAM
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Juan Fernandez Gonzalez
| 08 May 2017

During a troubled financial year in Latin America, pay-TV has managed to continue to grow, thanks to the availability of affordable options.

A report by The Competitive Intelligence Unit (CIU) has revealed the countries in which pay-TV prices are lower in relation to the GDP per capita, most of which are also the healthier markets in terms of subscribers, penetration and growth.

Mexicans spend 1.6% of their average income on pay-TV, the lowest rate in Latin America. Mexico is also the largest pay-TV market in the region, showing over 12% growth during 2016, according to figures from Dataxis, despite the financial climate.

The second country in the price-GPD ranking is Chile, where basic subscriptions cost 2.4% of the average income. Although it’s a small market compared to the region’s leader, Chile reported 3.7% growth last year, when it exceeded the three million subs barrier.

The third most-affordable pay-TV is found in Brazil, the only market in the region that has actually decreased during the past year (down 1.6%). However, other analysts have pointed out that pay-TV has survived better than other commodities, taking into account Brazil’s troubled financial situation (the GDP dropped by 5.6% in 2016).

In Argentina and Colombia prices are higher (3% and 4% of the GDP per person, respectively), but both have gone through very different financial scenarios. In Argentina (down 1.5% GDP in 2016), pay-TV also reported revenue drops despite slight subscriber gains (up 1.3%). Colombia, in a much better financial situation despite the devaluation of the pesos, reported a 6.9% growth in its pay-TV market.

The analysis of Latin America’s main five markets shows clearly that pay-TV has performed better than expected given the financial situation and has even thrived in those markets with the most affordable options.