HDTV 2008: Global uptake, strategies and business models

Screen Digest has identified three critical success factors that will support the successful migration to HDTV: penetration of HD-ready displays, supply of HD content and HD channels, and the availability of HD broadcast on a variety of television platforms. The report shows that all these are now cleared for a sustainable migration to HD in the long term.

In the next five years, HDTV will mainly develop as a pay TV product in Europe, and mostly a satellite product. However after analogue switch-offs are completed between 2010 and 2012, and digital free-to-air platforms are upgraded to more advanced technologies, they will end-up with more bandwidth capacity and become more widely accessible. It will kick-start the next phase of HDTV migration as HD becomes the mainstream and ultimately, the standard form of free television around the middle of next decade. In ten years, nobody will ever refer to ' high definition' as high definition will be everywhere. However, in the short term, HD broadcast offering in Europe remains patchy, for three reasons:

• Lack of HD on free-to-air platforms: only Sweden has already launched HD on free DTT and only France and the UK are likely to follow in the short-mid-term; ' Freesat HD' despite its name has a disappointing HD line-up and is not likely to make a strong market impact in the UK.
• Lack of local HD channels in many countries: pay TV operators relying mostly on US HD channels supply so far.
• Lack of ambition from a number of European pay TV operators.

HD has not been pushed hard enough yet by many of Europe' s pay TV operators. Paradoxically it has been used heavily as a marketing tool, but has not been followed through with the delivery of HD channels - for example, Premiere in Germany still only offers two HD channels and its HD uptake is sluggish. By contrast BSkyB has now 17 HD channels covering all genres, and on the back of this has signed up almost 500,000 subscribers in less than two years - the fastest take-up of any new BSkyB product. There is a clear connection between the depth of the HD offerings and the take up of HD by subscribers.

In European pay TV markets that shows signs of maturity, operators can use HD to drive ARPU, increase loyalty and reduce churn rates. HDTV can also drive pay TV acquisition, as new owners of HD-ready sets are frustrated by the lack of free HD sources. Pay TV operators should therefore seize this window of opportunity before free TV eventually accommodates more HD.

The new Screen Digest report also includes an exclusive and detailed analysis of how the migration to HDTV can also leverage the migration to MPEG4 in a virtuous circle. Screen Digest believes that small and medium sized pay-TV operators might benefit from reduced costs of transmission and release bigger capacity by migrating their subscribers to MPEG4 at an early stage.

• The penetration of HD-display TVs has reached 20 per cent in Western Europe, 36 per cent in North America.
• In 2012, in developed markets, HD-readiness will stand between 75 per cent and 100 per cent.
• Globally, households equipped with HD-display will grow from 87m in 2007 (9 per cent of TV households), to nearly 500m by 2012 (45 per cent).
• Approximately 100 HD channels available in the US and in Western Europe. Between 2 and 15 in each individual European country.
• In Europe, there were 1.2m active HD-enabled homes at end-2007 (less than one per cent) out of 30m HD-display homes, pay TV subscribers accounting for 80 per cent of all HD homes.
• By then, another 110m homes will only watch SD television signals on their HD displays (although many of them will be watching HD movies out of their Blu-ray players or playing HD console games).
• In home video, the emergence of Blu-ray as the only HD format is bound to drive uptake, overall HD awareness and quality expectations.
• Beyond broadcasting, cable and IPTV operators are also offering HD VOD offerings. IPTV and online VOD will struggle to offer HD because of bandwidth limitations.
• HD is becoming one key element in the competition between the four TV platforms (satellite, cable, IPTV, terrestrial) which have different capacities to offer HD content.
• HD is also a key element in pay TV marketing, helping to drive ARPU and reduce churn, but also potential driving customer acquisition.

• Comprehensive industry overview with historical data from 2000 through 2012 forecasts.
• Forecast of total market growth to 2012: HD-ready display homes and penetration, active HD viewers, number of HD platforms, number of HD channels
• Individual profile and assessment of HDTV strategy with five years' forecast data (HD subscribers) for a selection of top 18 pay TV operators
• Opportunities for international content providers, pay TV operators, investors and technology suppliers

Western Europe: UK, Austria, Belgium, Denmark, Finland, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, France

Central and Eastern Europe: Albania, Czech Republic, Estonia, Hungary, Poland, Romania, Russian Federation, Slovakia, Slovenia

North America: USA, Canada

South and Central America: Mexico

Africa and Middle East: Israel, South Africa, Turkey

Asia-Pacific: Australia, China, Hong Kong, India, Japan, Korea. Rep [S], New Zealand, Singapore, Thailand, Taiwan

• UPC
• Zon Multimedia
• Ono
• Virgin Media
• Welho
• Com Hem
• Coditel
• INDI
• Telenet
• Numericable
• Hot
• Get
• Casema
• Comcast
• Cox
• Cablevision
• Time Warner
• Neuf
• Orange
• Deutsche Telekom
• Fastweb
• Meo
• Corbina
• Belgacom
• Telefonica
• O2
• Altibox
• Imagenio
• BT Vision
• Tiscali
• BSkyB
• Canal Plus
• Canal Digital
• Canalsat
• Cyfra Plus
• Digital Plus
• Digiturk
• DirecTV
• Dish Networks
• Foxtel
• NTV Plus
• Polsat
• Premiere
• Sky Italia
• Sky Life
• Sky
• Viasat
• Yes TV
• Ofcom
• Philips
• BBC
• 3DFilm
• Christie
• Rogers
• SES Astra
• Eutelsat
• Telenor
• Sirius
• Channel Four
• Arte
• TV4
• ProSieben
• Discovery Holdings
• National Geographic
• Walt Disney
• ABC
• Cinemax
• HBO
• News Corp
• Big Bang
• Sony
• New Medium Enterprises
• Toshiba
• Twentieth Century Fox
• Universal
• Warner Bros
• Paramount
• Microsoft
• Filmflex
• History Channel
• NBC Universal
• Daily Motion
• NOS
• Zesko
• NPO
• Euro1080
• TV Vlaanderen.
• France Televisions
• TF1
• M6
• Thomson
• ZDF
• ARD
• RTL Group
• Unity Media
• Kabel Deutschland (KDG)
• T-Online
• Rai
• Mediaset
• Amstrad
• Pace
• Telecom Italia
• Sogecable
• Norges Televisjon
• RTV
• TeliaSonera
• SVT
• C More
• SBS Broadcasting
• MGM
• RTVE
• CCRTV
• ITV
• Five
• Arqiva
• Rainbow
• ORF
• Czech Television
• TV Nova
• Levira
• Estonian National Television
• Elion
• Samsung
• ITI Group
• Multimedia Polska
• Vectra
• Aster City Cable
• Portugal Telecom
• Cabovisao
• Comstar Direct
• SRG SSR Idee Suisse
• Swisscom
• Liberty Global
• Australian Broadcasting Corporation
• China Central Television (CCTV)
• Topway
• Gehua
• I Cable
• NHK
• J:Com
• TVNZ
• TV3
• SingTel
• Starhub Cable Vision
• Seoul Broadcasting System
• Korea Broadcasting System
• Education Broadcasting System
• Munhwa Broadcasting Corporation
• Korean HD Broadcasting Corporation
• Korea Telecom
• Sun Direct TV
• TSN
• CTV
• CityTV
• Cogeco
• Shaw Brothers
• Bell Canada
• Starz Group
• Scripps Group
• CNBC
• MTV Group
• Chiller
• Bravo
• Verizon
• AT&T
• Qwest
• Echostar
• Voom
• SABC
• Multichoice Africa
• Shin Satellite
• Formosa Television
• Taiwan Television Enterprise
• Public Television Service Foundation