More European households will be watching digital TV than will be using the Internet by 2006, according to Jupiter MMXI.
Among the factors that should drive this adoption are the migration of pay satellite and cable operators analog to digital TV services, and an increase in free-to-air digital terrestrial TV channels from the BBC and commercial broadcasters, accessed either through low-cost digital set-top boxes or through digital TV sets. Those European countries that currently have little cable coverage are also likely to experience the biggest growth in digital terrestrial services.
The European television audience will also be treated to more interactive features in the coming years. By 2007, 91 percent of DTV households will be using interactive services, such as personal video recorders (PVRs) and video on demand (VOD).
By the second quarter of 2002, Jupiter MMXI expects low-cost, set-top boxes will come onto the market, allowing viewers access to all free-to-air digital channels without the need to subscribe to a pay TV service. Jupiter MMXI believes they will have reached critical mass by 2004.
“Until recently, the industry had underestimated the potential of digital terrestrial free-to-air TV,” said Daniel Stevenson, the author of Jupiter MMXI’s report. “Growth of this platform will inevitably make life more difficult for cable and satellite pay TV operators. Interactive services, although at present basic, will develop rapidly and will transform the way TV is used.”
|European Digital TV Penetration|
|Total Digital TV
|Total Digital TV
|Source: Jupiter MMXI|
According to research on Europe’s digital television market by Strategy Analytics, Britain has stormed ahead with 37.0 percent of U.K. households having digital television at the end of last year, compared to a European average of 16.3 percent. By contrast, only 8.2 percent of German households could watch digital television.
Strategy Analytics believes the success of the U.K. market has been driven by intense competition between operators. It is one of the few countries in the world to have four commercial digital TV access platforms: satellite, cable, terrestrial and DSL. In Germany, by contrast, a major political battle between new cable investors and free-to-air broadcasters and regulators is looming. This could delay digital rollouts, making Germany one of the European laggards in advanced television services.
Scandinavia is the next most successful region for digital television, with penetration rates in Sweden, Denmark and Norway all above 20 percent
“We expect the majority of European homes to have digital television by 2006,” said Nick Griffiths, senior analyst with Strategy Analytics’ Consumer Practice. “But analogue switch-off remains a distant prospect for most countries until well into the next decade.”
The research also details the success of competing access technologies. Satellite operators continue to dominate the market, with 70.0 percent of viewers, although their share has fallen from 74.7 percent at the end of 2000. Cable has increased its share from 18.6 percent to 22.5 percent, while terrestrial operators had 7.4 percent of the market.
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