Pay-TV operators around the world will aggressively deploy over-the-top services like Dish Network's (NASDAQ: DISH) Sling TV over the next five years to stave off cord-cutting, but these services will result in lower margins overall for the global industry.
"In a growing number of pay-TV markets, service providers are expanding market presence by offering their own OTT video services, primarily as apps on tablets and third-party OTT media servers," wrote Jeff Heynen, research director for broadband access and pay TV at IHS Infonetics. Dish Networks, the second-largest satellite provider in the US, is offering an OTT video service called Sling TV that's aimed squarely at cord-cutters and cord-nevers. The net result of these offerings will be slower revenue growth globally as OTT services carry a lower ARPU."
Heynen made his predictions in IHS Infonetics' latest Pay-TV services and subscribers report, also noting that the global pay TV services market, including cable TV, satellite TV, telco TV and over-the-top (OTT) video, grew by 7 percent to $237 billion in 2014.
The report also said that global pay-TV subscribers increased 5 percent last year to 800 million, with OTT services providing the biggest growth.
- read this IHS press release
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