19.12.16

IHS: Cable market in European Union hits €22.4 billion

IHS graph representing cable market in european union

IHS Market has reported that the cable industry in the European Union (EU) has grown to a total worth of €22.4 billion, amidst increasing competition from traditional and Over-The-Top (OTT) players.

The report, released by the information and analytics provider IHS and the European cable trade association Cable Europe, is the first time full-year sales figures in Europe have been consolidated for 2015.

Key findings:

•             Gross cable revenues totalled €22.4 billion in 2015, up from €21.2 billion in 2014

•             Germany and the UK largest markets in terms of revenue (generating €4.7 billion and €4 billion respectively)

•             TV’s €10.5bn in revenue for 2015 accounted for almost half of total cable revenue

•             The contribution of internet and telephony services in the European Union has risen in recent years from 47 percent in 2010 to 53 percent in 2015

“In response to challenges posed by other platforms, 2015 saw a determined effort by many operators to invest in infrastructure and significantly improve their offerings,” said the report’s author, Maria Rua Aguete, research director at IHS Technology.  “Perhaps the most ambitious was Project Lightning, a huge broadband expansion programme undertaken by Virgin Media in the UK.”

Project Lightning, benefiting from investment totalling £3 billion, was established to connect an additional four million UK homes and businesses, extending Virgin Media’s cable homes from 13 million today to 17 million by 2019. Leading operators throughout Europe have upgraded broadband networks, allowing operators to offer internet download speeds of up to 1Gbps.

The report states that faster speeds will go hand-in-hand with the rollout of UHD services and data hungry SVoD services.

Internet revenue on the rise

Internet revenue also continued to grow in 2015, with cable internet revenue totalling €7.2 billion - 9.7% higher than 2014. The UK led the way with €1.5 billion, followed by Germany (€1.1 billion) and Spain (€0.8billion). The majority of European markets saw growth in internet revenue, though two Central and East European markets (Poland and Romania) saw slight declines compared to 2014.

Digital TV services growing in popularity

Despite the total number of cable TV subscribers in the European Union continuing to fall – the total at the close of 2015 was 55.1 million, down from 55.7 million a year earlier – the take-up of digital services was on the rise. By the end of 2015, close to two-thirds of cable homes opted for digital TV.

High Definition TV (HDTV) was a service taken by the majority (54 %) of European digital cable homes, while Ultra High Definition (UHD) was still in its infancy. Only a small number of operators, including Portugal’s NOS, added UHD channels to their line-ups. IHS state that the uptake of HD bodes well for acceptance of the new formats such as UHD and 4K, in the years to come.