Eastern European Pay Television

Since 2004 the CEE country economies and Russia have enjoyed rapid expansion, growing at more than double the rate of markets in Western Europe. 2007 saw the market growing at its fastest rate, with 18 percent growth of total pay TV subscribers.

Whilst Western European Pay TV markets are almost at saturation point, there is still huge potential for growth in the Eastern European markets and Russia especially. Growth comes as more subscribers are attracted to the satellite platform and new channels are launched to meet demand. Cable operators too are starting the process of digitisation which will enable them to reap the rewards of an improved viewer experience.

The Eastern European pay TV market is dominated by cable. Cable accounts for 80 per cent of all pay TV homes with almost one third of the region' s homes taking cable services. A few operators control the majority of the market, sharing it with many smaller players. Screen Digest believes that the market will experience consolidation over the next five years as the major operators grow their market share through acquisition. Whilst the mature cable subscriber base is not growing as fast as the newer satellite platforms, average revenue per user continues to rise, increasing by 10 per cent on average in 2007. Screen Digest predicts that cable penetration will increase to 40 per cent of homes in 2012 from 32 per cent at the end of 2007. Over the next five years, the number of digital cable subscribers will have increased from its present two per cent to 18 per cent of TV homes.

Other forms of pay TV are much less advanced in the region, and Screen Digest expects that to remain the case to 2012. Digital terrestrial television is still in its infancy and by 2012, less than six per cent of the region' s homes will rely on DTT as their primary means of TV viewing. IPTV is a nascent platform in Eastern Europe and although growth will begin to take off in 2009, less than three per cent of homes will make use of IPTV as their primary TV reception method by 2012.

• Eastern Europe continues to be a cable-driven market with 32 per cent of TV homes served by cable.
• By contrast, satellite pay TV is still a relatively small market serving around eight per cent of homes. This is changing rapidly, however, with a huge number of new satellite platform launches in the region over the last couple of years.
• Screen Digest forecasts that total satellite pay TV penetration will more than double from eight per cent at the end of 2007 to 16 per cent by 2012. All of these satellite pay TV subscribers are digital.
• During the same period, cable penetration will increase from 32 per cent to 40 per cent of homes. Continued migration of the largely analogue cable subscriber base will see digital cable penetration increase from less than two per cent of homes at the end of 2007 to 18 per cent of homes by 2012.
• Digital terrestrial television remains in its infancy and by 2012, less than six per cent of the region' s homes will rely on DTT as their primary means of TV viewing.
• IPTV is another nascent platform in Eastern Europe and although growth will begin to take off in 2009, less than three per cent of homes will make use of IPTV as their primary TV reception mode by 2012.
• Nonetheless, driven by continued strong growth in the traditional cable and satellite markets, total pay TV penetration will increase rapidly from 40 per cent at the end of 2007 to 60 per cent by 2012 with a total of 63m homes subscribing to pay television services.
• Russian is set to be a key growth market showing particularly strong increases in pay TV. Total pay TV subscribers in Russia will reach 28m by 2012.
• Russian pay TV growth will be driven by a rapidly expanding satellite pay TV market with nearly 5m pay satellite customers forecast by 2012, up fromless than 1.5m at the end of 2007.