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IPTV Gains Ground as Europe Hits 160 Million Broadband Subscribers by 2020

Posted: 28th Sep, 2011 By: MarkJ
youview uk set-top-boxpoint topicTelecoms analyst Point Topic UK has estimated that Europe (EU27) will be home to more than 160 million broadband subscribers by 2020 and over one in three of those will have an internet based television ( IPTV ) service subscription. However the analyst warns that IPTV products still have a lot to prove.

Oliver Johnson, CEO of Point Topic, explained:

"The success of IPTV in France compared to other countries in Europe and worldwide can’t be attributed to a single reason. A number of conditions exist which has made the diffusion of IPTV through the market much easier and quicker than in others, perhaps the main driver has been competition.

France, with Free Internet as a good example, has much clearer and more transparent tariffs for IPTV and that has not only earned the consumers trust but allowed them to align the value they derive from the services with the amount they pay. It’s a simple equation but not the natural approach we’ve become used to from operators.

Often the price isn’t obvious for each bundle constituent, and there are a number of reasons for this, but the end result is that the consumer resists purchase far more than they might if they felt they had better information.

The entrance of Google and Apple in particular into the internet TV market could be a game changer. Along with services like Netflix, Hulu and offerings from other OTT suppliers, we could see a significant increase in competition and, hopefully for consumers, more clarity and lower prices."

The firm also examined over 2,000 standalone and bundled tariffs from around the world and estimated how much extra ISPs charge to add an IPTV service to their subscriptions. The study reveals that "a consumer will pay 66 US dollars [or £42] per month" (average) for a combined broadband and IPTV service.

Oliver Johnson added:

"If we split out the broadband charge we get revenues today of just over 5.3 billion dollars a year for IPTV services rising to 14.8 billion in 2020 in the EU27."

Not everybody agrees that IPTV services will be a success (here). A recent report from analyst firm Digital TV Research (DTVR) warned that less than 1 million UK homes will pay for IPTV services by 2016 (BT Vision already has about 600,000 customers).

That could be bad news for YouView (Project Canvas), a UK subscription-free and broadband ISP based video-on-demand and catch-up TV ( IPTV ) service, which is due to launch during the first half of 2012. IPTV also requires a strong broadband infrastructure for the best service and in that respect the UK is still playing catch-up.
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