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Cable Technology Feature Article

May 20, 2010

ABI Research: Pay TV Revenue to Exceed $312 Billion in 2010

By Calvin Azuri, TMCnet Contributor

This year, 2010, is expected to be a better year for the "Pay TV" after the recession slowed market growth in 2009. The reasons: operators signing up new subscribers, and existing subscribers migrating to premium channels and advanced services.

According to Jason Blackwell, ABI Research (News - Alert) practice director, due to positive market outlook for pay TV, global pay TV revenue will net more than $312 billion for cable and telecom carriers in 2010.

With the broadband penetration and Internet speeds ramp up, the telco TV service revenue is growing the fastest among the different pay TV platforms. Deutsche Telekom's IPTV (News - Alert) subscriber base has reached one million within a year which is almost the double of last year. Operators will have the opportunity to offer High Definition IPTV which will help boost ARPU and service revenue with the expansion of fiber broadband deployment. Telco TV service revenue will top $17 billion in 2010 as anticipated by ABI Research.

The largest market share in terms of telco TV service revenue will be captured by Western Europe with 59% with North America and Asia Pacific being the second and third largest telco TV markets. In the next few years, telco TV service revenue is expected to grow rapidly in the Asia Pacific region where it is expected to achieve 25 percent by 2015. 2009 saw Asia Pacific telco TV service revenue comprising only 10% of the total market.

Pay TV operators are competing to raise ARPU and lower churn.  Introduction of high definition TV services and upgraded programming packages is being offered by many operators. Research Associate Khin Sandi Lynn notes that the purchase of HDTV set top boxes needs to be aggressively promoted by the Pay TV operators to lift ARPU. Benefits of HD for the end-user viewing experience need to be better promoted by the carriers. Lynn also added that not many users are clear on the benefits of the upcoming 3D TV.

A quarterly update of its "Pay-TV ARPU and Revenue Database" was completed by ABI Research as a part of the company's Digital Media Research Service and available at http://www.abiresearch.com/research/1003841. This report provides historical and forecast data for ARPU, and service revenue forecasts for satellite, cable and telco TV.

Calvin Azuri is a contributing editor for TMCnet. To read more of Calvin's articles, please visit his columnist page.

Edited by Marisa Torrieri