Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020- 2025
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Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025
Pay TV and OTT video in
Central and Eastern Europe:
trends and forecasts 2020–
2025
Martin Scott, Jakub Konieczny and Olamide Makinde
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 2
About this report
This report provides: G E O G RAPHICAL C O V ERAG E K E Y M E T R ICS
▪ forecasts for the number of pay-TV households and services, Region modelled: ▪ Pay-TV households and
premium OTT video users, their retail revenue (spend) and ▪ Central and Eastern Europe connections
average spend per user (ASPU) (CEE) ▪ OTT video users
▪ Retail revenue (spend)
▪ forecasts split by pay-TV platform: cable (analogue and Countries modelled individually
digital), IPTV, pay DTT, satellite (DTH) and operator OTT.1 (additional in-depth coverage is ▪ ASPU
Operator OTT and third-party OTT are split by category of OTT provided for those in bold):
Pay TV is split by the following
video service – linear channels, linear events, TVoD (rental), ▪ Bulgaria access technologies:
TVoD (ownership) and SVoD ▪ Croatia
▪ cable (analogue and digital,
▪ Czech Republic CATV)
▪ forecasts for 16 individual countries and the region as a ▪ Estonia
whole, with additional in-depth coverage for 4 countries. ▪ IPTV
▪ Hungary
▪ pay digital terrestrial TV (DTT)
W HO S H O U L D R E A D T HI S R E P O RT ▪ Latvia
▪ Lithuania ▪ satellite (DTH)
▪ Product and strategy managers within pay-TV providers and operators ▪ operator OTT1
▪ Montenegro
who require market sizing for business planning purposes, as well as an
overview of the key trends that are affecting the market in order to help ▪ Poland ▪ third-party (non-operator) OTT
them to develop propositions accordingly. ▪ Romania
▪ Russia OTT video is split as follows:
▪ Business development managers within vendors of video solutions who
need to assess the size of the opportunity for their products and ▪ Serbia ▪ linear – channels (paid-for and
services. ▪ Slovakia free)
▪ Financial analysts who need to understand the dynamics and the size of ▪ Slovenia ▪ linear – events
the pay-TV market and its interaction with OTT video services. ▪ Turkey ▪ TVoD (rental and ownership)
▪ Ukraine ▪ SVoD (paid-for and free)
1 The full definition of the term ‘Operator OTT’ is articulated in the appendix at the end of this report. In short, this term refers to
OTT video services offered by telecoms operators and also by pay-TV providers that have previously provided traditional pay-TV
services.
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 3
An introduction to the terms and definitions used in this forecast report
The pay-TV market is in the middle of a reconfiguration: service Furthermore, multi-screen services (for example,
categories are changing, and terms such as ‘connections’ and unmanaged IP services that are sold alongside traditional
‘subscribers’ (which fit into broadcast TV services reasonably pay-TV services to diversify the ways that consumers view
well) do not apply as well to OTT services. This forecast provides content) are not included in ‘OTT services’. Revenue for such
multiple category splits that aid different purposes, such as services is attributed to the associated traditional pay-TV
understanding the role of existing pay-TV providers versus new service.
OTT entrants, the scale of on-demand consumption versus live
▪ Operator OTT. The full definition of this term is articulated in
streaming and whether the mode of purchase is transactional or
the appendix. In short, this refers to OTT video services
subscription-based. As such, detailed articulation of the terms
offered by telecoms operators and also by pay-TV providers
used and the categorisations made is required in order to provide
that have previously provided traditional pay-TV services.
full clarity. Further detail regarding these assumptions, terms and
our methodology can be found at the end of this report. ▪ Third-party OTT. This refers to services offered by OTT video
providers that have not offered traditional pay-TV services in
Key terms and conventions used in this report
a country in the past. This includes, for example, Amazon,
▪ ‘Traditional’ versus ‘OTT’. ‘Traditional’ services refer to TV DAZN and Netflix. It also includes Sky’s OTT service in Spain
services delivered over a managed network that provide a (where it launched an OTT service in 2018, but had not
known and predictable latency and quality of broadcast previously offered a traditional pay-TV service).
content. ‘Traditional’ access technologies include the sum of
▪ Connections and users. Consumers may subscribe to
services carried over IPTV, cable, DTH and pay DTT.
multiple traditional pay-TV services and use multiple OTT
▪ OTT services. These are TV or video services that are services at once. This makes the process of forecasting
delivered over an unmanaged IP connection, known as ‘the users and revenue complex. This forecast allows for multiple
open internet’. In this report, we use this term as a traditional pay-TV subscriptions by articulating both the
contraction of ‘premium OTT services’, which are services number of pay-TV ‘households’ and the number of
that generate transactional or subscription revenue, not ‘connections’. For OTT, this report forecasts ‘users’ of
exclusively advertising revenue. This means that services particular types of services; a single user may use multiple
such as the free YouTube service are not included, but a services, and this is reflected in higher spend assumptions
free trial to Netflix is included. for each user.
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 9 COVID-19: the COVID-19 pandemic will have a limited effect on traditional pay-TV revenue in 2020, but will lead to an increase in OTT video usage The COVID-19 pandemic has affected the pay-TV and OTT video Figure 4: Pay-TV and OTT retail revenue by service, showing the markets in CEE to a lesser extent than in other regions. The low effect of COVID-19 (logarithmic scale), CEE, 2018–20211 price of traditional pay-TV services plus strong price competition means that pay-TV providers have limited capital to invest in exclusive sports content. As such, their ability to differentiate was not significantly disrupted by the loss of sports coverage during parts of 2020. Additionally, traditional pay-TV services are purchased annually in some countries (such as Russia), meaning that subscriptions were not disrupted during the first wave of the pandemic. The looming economic recession will put pressure on consumer spending, but TV and video spending is robust, as we saw in 2008–2010 (and prices are low in CEE). SVoD services have benefitted from the lockdowns associated with the pandemic: people used more free trials and also chose to pay for services, either for the first time or by stacking new services on top of existing subscriptions, because of the increase in the amount of time spent at home. Disney+ did not launch in CEE (we expect it to launch in major countries in the region in 2021), but local players such Platforma Canal+ in Poland gained large numbers of new OTT video subscribers in 2020. Linear OTT revenue was affected by the pandemic, though its contribution to the total is low. Services that offer pay-per-view sports coverage were particularly affected. Indeed, DAZN delayed its regional launch from 1Q 2020 to 4Q 2020 as a result. TVoD rentals also increased due to more time being spent at home. 1 The arrow denotes the change in the value due to COVID-19.
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 17
Czech Republic: the number of subscribers to third-party and operator OTT video
services has been boosted by the pandemic
The COVID-19 pandemic boosted viewership and revenue for OTT VIDEO MARKET KPIs 2025
third-party OTT video services in 2020. This boost will be ongoing:
revenue in 2025 will be 76% higher than that in 2020, despite the
twin challenges of piracy and popular free-to-air services.
Operator retail revenue will grow threefold to CZK2.5 billion
(EUR93 million) during 2020–2025. O2 and Telly (previously Digi) €
will have the most successful operator OTT services due to
$ 779.6
investments in football rights and a cheap, flexible range of
tariffs, respectively. However, we also expect that Skylink’s new THOUSAND
472.6
PER MONTH
DTT/OTT hybrid service will become popular (we classify this as
pay DTT on the previous slide and do not count it in our OTT
numbers to avoid double counting).
Figure 15: Retail revenue by OTT video service type, and ASPU, Figure 16: Number of users by service type, Czech Republic,
Czech Republic, 2017–2025 2017–2025
1Includes paying users of OTT video services, but also users on free trials of paid-for services and customers that gain inclusive
access to an otherwise paid-for service as a result of a bundle with, for example, telecoms services.
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025
Contents Executive summary
Regional trends
Country-level trends
Forecast methodology and assumptions
About the authors and Analysys Mason
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 29
About the authors
Martin Scott (Principal Analyst) heads Analysys Mason's research initiatives related to media and TV. He manages the Video, Gaming and
Entertainment research programme. Martin has held numerous positions within Analysys Mason during the last 15 years, including heading the
company's Consumer Services, Data and Regional Markets practices. He also launched Analysys Mason's Connected Consumer
Survey and Consumer smartphone usage series of research. His primary areas of specialisation include telecoms TV strategy, OTT video and
media, consumer behaviour, customer satisfaction and consumer-facing marketing strategy. He also specialises in statistics, surveys and the
analysis of primary research.
Jakub Konieczny (Analyst) is a member of the regional markets research team in London, contributing mainly to the Telecoms Market
Matrix, European Country Reports and Global Telecoms Data research programmes. Jakub holds a BEng in petroleum engineering from the
University of Aberdeen.
Olamide Makinde (Research Analyst) is a member of the Data Team in London, contributing primarily to the European Country Reports, The
Middle East and Africa and Telecoms Market Matrix research programmes. Olamide holds a BSc in Molecular Genetics from Kings College
London and an MSc in Genomic Medicine from Queen Mary University.
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 30
Analysys Mason’s consulting and research are uniquely positioned
Analysys Mason’s consulting services and research portfolio Consulting
We deliver tangible benefits to clients across the telecoms
industry:
▪ communications and digital service providers, vendors,
financial and strategic investors, private equity and
infrastructure funds, governments, regulators, broadcasters
and service and content providers
Our sector specialists understand the distinct local challenges
facing clients, in addition to the wider effects of global forces.
We are future-focused and help clients understand the challenges
and opportunities new technology brings.
Research
Our dedicated team of analysts track and forecast the different
services accessed by consumers and enterprises.
We offer detailed insight into the software, infrastructure and
technology delivering those services.
Clients benefit from regular and timely intelligence, and direct
access to analysts.Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 31 Research from Analysys Mason
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025 32 Consulting from Analysys Mason
Pay TV and OTT video in Central and Eastern Europe: trends and forecasts 2020–2025
PUBLISHED BY ANALYSYS MASON LIMITED IN JANUARY 2021
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