IPTV subscription numbers in the European Union should hit 60 million by 2020, according to a new report from Point Topic.
The research company said just more than one in three of the projected 160 million broadband subscribers are likely to opt for IPTV as well, but it added that uptake in different countries has varied greatly. Part of that is due to price and availability, said Point Topic CEO Oliver Johnson, but the variance also is affected by how entrenched incumbent TV services are.
"The success of IPTV depends primarily on two factors," he said. "Firstly, is it available, not only the physical network but at a price the consumer can afford? Where the cost and the link are suitable there is demand for IPTV as we've seen in France. However in many markets not only are cost and availability significant barriers but the incumbent TV services are well entrenched."
Johnson said France, which has free Internet, has out performed other regions in IPTV uptake, partly because the cost of bundles is clearer and more transparent than in other countries.
"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," he said. "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."
Point Topic estimates that a consumer pays about $66 per month for IPTV and Internet services in the EU. Splitting out the Internet revenues, IPTV revenues today total just over $5.3 billion a year for IPTV services; Point Topic expects that to increase to $14.8 billion in 2020.
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