Technology

China to become Asia’s top pay-TV economy in 2011: Study

MUMBIA: While China has long been the world’s largest multichannel market in terms of subscribers, 2011 revenues of $7.5 billion are set to surpass Japan for the first time, ranking China as the top pay-TV market in Asia and the fifth largest in the world.


According to SNL Kagan, China’s video service revenues grew 31.1 per cent in 2010 to reach $5.8 billion with growth driven by cable digitisation and a 9 increase in pay-TV households.


Between 2010 and 2015, SNL Kagan forecasts China’s multichannel subscriber base to grow at a 5.8 per cent CAGR to reach 259.5 million households as video service revenues grow at a 20.5 per cent CAGR to $14.7 billion.


Key findings in the reports include:


•Despite IPTV gaining momentum, cable continues to dominate China’s pay-TV landscape accounting for 95.7 per cent of multichannel subscribers and 91.2 per cent of video service revenues in 2010.


•47 per cent of China’s cable subscribers had migrated to digital connections by end 2010. In 2011 a further 22.5 million households are expected to adopt digital cable service.


•HD services are gaining ground with 2.5 million cable homes adopting the set-top-boxes and packages needed to access HD programming in 2010. By 2015, 17.2 million cable households are forecast to be HD.


•VOD is gaining steam with deployments in place at major operators including: Jiangsu BC&TV Network, Shenzhen Topway, Hebei TV Network, Oriental Cable Network, Wasu Digital TV, Shaanxi BC&TV Network, Chongqing Cable Network, and Beijing Gehua.


•IPTV accounted for 3.8 per cent of China’s multichannel subscribers in 2010, with 7.4 million households generating $493.2 million in video service revenues.


•China is the world‘s largest fixed broadband market, with 31.1 per cent of total households or 126.3 million subscribing to fixed line broadband in 2010. 
 
 
Regulatory forces including the State Council’s pursuit of
three-network convergence (telecom, broadcast TV and Internet) are expected to reshape China’s pay-TV landscape in the medium term as telcos and cable companies enter each other’s businesses and deploy double and triple-play packages.


In parallel, rising broadband adoption will create significant opportunities for emerging Internet video players.


As a result, SNL Kagan Media and Communications analyst Eva Zhang commented, “China’s pay-TV market continues to see exceptional growth as cable digitization and IPTV rollouts invigorate product offerings and boost average-revenue-per user. Over the coming five years we expect cable and IPTV ARPU will grow at 13.7 per cent and five per cent CAGR, respectively.”

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