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Kagan: Global pay-TV households are still growing

The number of households subscribing to pay-TV operators continues to grow despite a predicted drop in penetration

Despite predictions to contrary, the number of households worldwide who subscribe to pay-TV services is expected to continue to grow in the next five to ten years.

According to Kagan, the media research unit of S&P Global Market Intelligence, nearly 1.15 billion homes worldwide will have a pay-TV subscription by the end of 2025.

Despite the growth in overall pay-TV households, operators are shutting down traditional TV services and moving customers to either their own or a third-party streaming service, said Kagan. Multichannel penetration of TV households is therefore expected to decline to 58.8 per cent by end-2021 after peaking at 60.6 per cent in 2018, continuing to decline to 56.6 per cent by 2025.

In 2020, IPTV overtook DTH to become the second-largest multichannel platform worldwide, with an estimated 284.1 million subscribers at the year’s end, said the research.

IPTV is forecast to grow globally as well as in every region except North America, accounting for 28.9 per cent of global pay-TV homes by 2025. The DTH segment, however, is expected to stagnate on the global scale, declining in the Americas and Western Europe.

Kagan added that the global multichannel economy is likely to generate $191.18 billion in video service revenues by the end of 2021, representing a 3.5 per cent year-over-year decline compared to 2020.

This trend is expected to continue as global video service revenues decline at a negative 2.4 per cent CAGR from 2020 to 2025 due to rapid pay-TV household losses in North America.

However, the research suggests video service revenues will continue growing in other global regions, with Eastern Europe posting the highest CAGR in that time period at 3.9 per cent.