Table of Contents
•This cross-practice market insight gathers data from several local teams within Frost & Sullivan’s global information and communications technologies (ICT) practice. This insight is designed to provide a global picture of average revenue per user (ARPU) for pay TV content and fixed broadband (FBB) on a region-by-region basis. Additionally, this study recommends ARPU growth strategies.
•Predictably, ARPUs for pay TV are highest in affluent, advanced markets with saturated pay TV demographics and are flat to declining slightly in future projections. ARPUs in emerging markets are lower and are trending upwards.
•Regional variances in broadband ARPUs exist but are less dramatic, particularly when actual broadband bandwidth is factored in. The highest speeds available vary significantly across and even within countries, with corresponding variances in ARPU.
•The United States leads with the highest pay TV ARPU at well over $ x per month. India and China have the lowest ARPUs at well under $ x per month, driven down in particular by the widespread uptake of basic digital cable packages.
•A key global pattern is that in advanced countries, pay TV is on average more expensive than broadband, whereas in developing countries, broadband is more expensive than pay TV.
Market Overview and Definitions
•This analysis measures the ARPU in US dollars per month for FBB and pay TV, including satellite direct–to-home (DTH), internet protocol television (IPTV), cable, and pay digital terrestrial television (DTT), where applicable.
•The analysis does not normalize ARPUs based on comparative differences in services. For example, average broadband speeds in North America are quite different from average broadband speeds in the African subcontinent, but the corresponding ARPUs are reported as-is without adjusting for the bandwidth disparity.
•The goal of this brief insight is to highlight variations in regional metrics while providing a global view of present revenue levels and forward trends. ARPU is a significant metric that influences operator spending (the inability to grow ARPUs typically results in restricted investments), whereas the promise of higher ARPUs leads to a higher appetite for upgrades and new service rollouts.
•The following regional definitions are used in this analysis:
oAdvanced Asia-Pacific (APAC): Japan, Korea, Australia, New Zealand, Taiwan, Singapore, and Hong Kong
oEmerging APAC: All countries in APAC, except those listed under advanced APAC
oCentral America and Latin America (CALA)
oNorth America: Canada and the United States
oAdvanced Europe, the Middle East, and Africa (EMEA): Western Europe, select Middle Eastern economies, and South Africa
oEmerging EMEA: All regions in EMEA, except those listed under advanced EMEA
•Pay TV and broadband have a wide global disparity in ARPUs, with the highest values in North America being more than x times their counterparts in emerging APAC. Disparity in pay TV revenues is higher than in broadband fees, which is a consequence of the discretionary nature of pay TV charges and features and the differing preferences across regions in terms of willingness to invest in high-end features or a broader range of premium content.
•In the major markets of North America, advanced EMEA, and advanced APAC, subscribers tend to pay more for pay TV than for broadband, given the typically high resolution of content, higher costs to operators for program licensing, and the focus on value-added features such as personal video recorders (PVR), digital video recorders (DVR), and over-the-top (OTT) content.
•CALA has a similar pattern of higher ARPUs, but this is influenced to some degree by the high prevalence of pre-paid or post-paid pay TV access, which is not reflected in the monthly ARPU measurements.
•In emerging EMEA, and more emphatically in emerging APAC, broadband is far from being a commodity. Because costs appear low compared to major markets, typical bandwidth speeds in these emerging markets are significantly lower than the norm in more advanced economies.
•In contrast, pay TV tends to be characterized by broadcaster programming, SD resolution content, and low-cost zapper set-top boxes (STB), therefore, pay TV is priced low as a consequence.
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