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TV Service Providers - UK - October 2013

Published By :

Mintel

Published Date : Oct 2013

Category :

Lifestyle

No. of Pages : 163 Pages


Whilst the pay TV sector is in a healthy position, providers will be under greater pressure to stay ahead of subscription-free products and services. Although pay TV providers have so far seen off much of the threat from free-view-view platforms, smart TVs and wireless streaming services will arguably present an even greater challenge in years to come. As these devices reach more people, consumers will start to expect a strong on-demand platform as standard, which could put a cap on the premium that companies can charge for TV subscriptions.
TABLE OF CONTENT

Introduction
Definition
Abbreviations

Executive Summary
The market
Volume
Figure 1: Forecast volume of pay TV subscribers, 2008-18
Value
Figure 2: Forecast value of pay TV subscriptions, 2008-18
Market drivers
Providers focus on triple-play bundles in order to improve retention
Figure 3: Take-up of bundled communications services, 2005-13
A third of smart TV users reconsidering pay TV subscription
Figure 4: Attitudes towards smart TV, 2013
Sports segment pushed on by BT cash injection
Figure 5: Multichannel spend (by broadcasters and service providers) and subscription revenue, by genre, 2012
The consumer
Sky still leads the way as its focus changes to maximising revenue from existing customers
Figure 6: Consumers’ subscription status and awareness of pay TV service providers, August 2013
Freeview received by over two thirds of consumers
Figure 7: TV services have in the home, August 2013
‘Free’ BT Sport offers ensure early sign-ups
Figure 8: BT Sport subscription uptake, August 2013
On-demand is now in demand amongst pay TV subscribers
Figure 9: Attitudes towards pay TV services, August 2013
Almost half of non-subscribers could be tempted to sign up to pay TV
Figure 10: Factors that could encourage non-subscribers to pay for TV services, August 2013
What we think

Issues in the Market
Will the improvement of subscription-free services limit the value of pay TV?
How can BT use sport to win customers from its rivals?
How can providers retain consumers beyond initial contracts?
Are free-to-view services set to decline beyond 2013?

Trend Application
Trend: Nouveau Poor
Trend: Make it Mine
Mintel Futures: Access Anything, Anywhere

Market Drivers
Key points
Providers focus on triple-play bundles in order to improve retention
Figure 11: Take-up of bundled communications services, 2005-13
Figure 12: Fixed broadband market share, 2007-12
Television has divorced from the TV
Figure 13: Sky Go app, shown on an iPad, launched 2011 (formerly known as Sky Player and Sky Mobile TV)
A third of smart TV users reconsidering pay TV subscription
Figure 14: Attitudes towards smart TV, 2013
Service bundling: should providers embrace competition?
Standard of TV programming alienating older consumers…
Figure 15: Opinion on programme standards over the last 12 months, by age, 2012
but watching television still the most popular media activity by far
Figure 16: Which media activity would UK adults miss the most 2005-12
Sports segment pushed on by BT cash injection
Figure 17: Multichannel spend (by broadcasters and service providers) and subscription revenue, by genre, 2012
TV advertising revenue curbed by move to digital
Figure 18: Total TV advertising expenditure (all channels), July-June 2008/09-2012/13

Who’s Innovating?
Key points
Sky trials personalised advertising scheme
TalkTalk launches ‘The Big Free’
Virgin and Netflix in unlikely partnership
Self-installations help Sky to reduce operating costs

Market Size and Forecast
Key points
Package upgrades and more new subscriptions see growth continue
Figure 19: Total volume and value of pay TV subscriptions, 2008-18
Forecast
Figure 20: Forecast volume of pay TV subscribers, 2008-18
Figure 21: Forecast value of pay TV subscriptions, 2008-18
Forecast methodology

Segment Performance
Key points
ADSL segment cashes in on Freeview upgrades
Figure 22: UK multichannel TV households by platform 2008-13
Number of homes to only use free-to-view services is set to decline in 2013
Figure 23: UK multichannel TV households, by subscription type, 2008-13

Market Share
Key points
Pay TV share stabilising despite the introduction of BT Sport
Figure 24: Volume of UK TV households, by provider, 2012 and 2013

Companies and Products
Key points
British Sky Broadcasting Group PLC (BSkyB)
Figure 25: British Sky Broadcasting (BSkyB), financial information, 2012-13
Virgin Media Inc.
Figure 26: Virgin Media, financial information, 2011-12
BT TV (part of BT Retail)
Figure 27: BT Retail (including BT TV), financial performance, 2012-13
TalkTalk Telecom Group PLC
Figure 28: TalkTalk, financial performance 2012-13
Freeview (DTV Services Ltd)
Freesat
YouView TV Ltd

Brand Communication and Promotion
Key points
Sky increases ad expenditure as competition intensifies
Figure 29: TV service advertising expenditure, by company, 2008/09-2012/13
Sky ads move online and outdoors
Figure 30: TV service advertising expenditure, by media channel, 2008/09-2012/13
Figure 31: TV service advertising expenditure, by media channel, 2012/13

TV Services in the Home
Key points
Sky still leads the way as its focus changes to maximising existing customers
Figure 32: Consumers’ subscription status and awareness of pay TV service providers, August 2013
Figure 33: TV services subscribed to – all TV owners, August 2013
Market stabilises, but TalkTalk shows promise
Figure 34: TV services subscribed to – all paid TV subscribers, July 2012 and August 2013
BT TV has said goodbye to over half of its all-time customers
Figure 35: Proportion of ‘all-time’ TV subscribers who are currently taking a TV subscription from that same provider, August 2013
Sky customers more likely to be young men
Figure 36: Sky TV subscribers, by age and gender, August 2013
Lack of cable prevents Virgin Media from reaching more rural areas
Figure 37: TV services currently subscribed to, by area, August 2013
TalkTalk success could depend on reputation overhaul
Figure 38: Pay TV complaints per 1,000 customers/connections, Q4 2011-Q1 2013, by quarter
Freeview received by over two thirds of consumers
Figure 39: TV services have in the home, August 2013
YouView mobile service could attract more young people
Figure 40: TV services have in the home, by age, August 2013

Consumer Uptake of and Interest in BT Sport
Key points
‘Free’ BT Sport offers ensure early sign-ups
Figure 41: BT Sport subscription uptake, August 2013
A quarter of non-BT Sport subscribers show interest in signing up
Figure 42: Interest in signing up to BT Sport, August 2013
Upcoming bidding wars could decide the fate of BT Sport
Figure 43: Preferred methods of subscribing to BT Sport, August 2013
Freeview could use smart TV apps as a defence mechanism
Figure 44: Interest in signing up to BT Sport, by TV services subscribed to, August 2013
Sky could offset the cost of BT Sport
Lack of interest goes beyond apathy towards sport
Figure 45: Reasons for not being interested in BT Sport, August 2013

Attitudes towards Pay TV Services
Key points
On-demand is now in demand amongst pay TV subscribers
Figure 46: Attitudes towards pay TV services, August 2013
Providers can reward loyalty with long-term deals
Bundles could help Sky to address value concerns
Figure 47: Attitudes towards paid TV services, by TV services subscribed to, August 2013

Ways of Attracting Non-subscribers
Key points
Figure 48: Factors that could encourage non-subscribers to pay for TV services, August 2013
Younger consumers the most likely to upgrade
Figure 49: Factors that could encourage non-subscribers to pay for TV services, by age, August 2013
Providers can lessen churn by learning from ex-customers
Figure 50: Factors that could encourage non-subscribers to pay for TV services, by TV services subscribed to, August 2013

Appendix – Market Size and Forecast
Figure 51: Forecast volume of pay TV subscribers, 2013-18
Figure 52: Forecast value of pay TV subscriptions, 2013-18

Appendix – TV Services in the Home
Figure 53: TV services subscribed to, August 2013
Figure 54: TV services subscribed to – Sky, by demographics, August 2013
Figure 55: TV services subscribed to – Virgin Media, by demographics, August 2013
Figure 56: TV services subscribed to – BT Vision, by demographics, August 2013
Figure 57: TV services subscribed to – TalkTalk, by demographics, August 2013
Figure 58: TV purchasing plans, by TV services subscribed to – Sky, August 2013
Figure 59: TV purchasing plans, by TV services subscribed to – Virgin Media, August 2013
Figure 60: TV purchasing plans, by TV services subscribed to – BT vision, August 2013
Figure 61: TV purchasing plans, by TV services subscribed to – TalkTalk TV, August 2013
Figure 62: TV services have in the home, August 2013
Figure 63: Most common TV services in the home, by demographics, August 2013
Figure 64: Next most common TV services have in the home, by demographics, August 2013
Figure 65: TV services have in the home, by TV services subscribed to – Sky, August 2013
Figure 66: TV services have in the home, by TV services subscribed to – Virgin Media, August 2013
Figure 67: TV services have in the home, by TV services subscribed to – BT vision, August 2013
Figure 68: TV services have in the home, by TV services subscribed to – TalkTalk TV, August 2013

Appendix – Consumer Uptake of and Interest in BT Sport
Figure 69: BT sport subscription uptake, August 2013
Figure 70: BT Sport subscription uptake, by demographics, August 2013
Figure 71: Interest in signing up to BT Sport, August 2013
Figure 72: Interest in signing up to BT Sport, by demographics, August 2013
Figure 73: Preferred methods of subscribing to BT Sport, August 2013
Figure 74: Preferred methods of subscribing to BT Sport, by demographics, August 2013
Figure 75: Reasons for not being interested in BT Sport, August 2013
Figure 76: Most common reasons for not being interested in BT Sport, by demographics, August 2013
Figure 77: Next most common reasons for not being interested in BT Sport, by demographics, August 2013

Appendix – Attitudes towards Pay TV Services
Figure 78: Attitudes towards paid TV services, August 2013
Figure 79: Most common attitudes towards paid TV services, by demographics, August 2013
Figure 80: Next most common attitudes towards paid TV services, by demographics, August 2013
Figure 81: Least common attitudes towards paid TV services, by demographics, August 2013
Figure 82: Attitudes towards paid TV services, by TV services subscribed to – Sky, August 2013
Figure 83: Attitudes towards paid TV services, by TV services subscribed to – Virgin Media, August 2013
Figure 84: Attitudes towards paid TV services, by TV services subscribed to – BT Vision, August 2013
Figure 85: Attitudes towards paid TV services, by TV services subscribed to – TalkTalk, August 2013

Appendix – Ways of Attracting Non-subscribers
Figure 86: Factors that could encourage non-subscribers to pay for TV services, August 2013
Figure 87: Most common factors that could encourage non-subscribers to pay for TV services, by demographics, August 2013
Figure 88: Next most common factors that could encourage non-subscribers to pay for TV services, by demographics, August 2013
Figure 89: Factors that could encourage non-subscribers to pay for TV services, by TV services have in the home, August 2013
Figure 90: Factors that could encourage non-subscribers to pay for TV services, by TV services subscribed to – Sky, August 2013
Figure 91: Factors that could encourage non-subscribers to pay for TV services, by TV services subscribed to – Virgin Media, August 2013
Figure 92: Factors that could encourage non-subscribers to pay for TV services, by TV services subscribed to – BT Vision and TalkTalk, August 2013

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