The growing power of IPTV has been revealed in research from Ovum that shows telecoms operators now own around a fifth of the world's pay-TV subscriptions.
The research calculates that operations owned or controlled by telcos accounted for 140 million retail pay-TV customer connections globally at the end of 2014, but by the end of this year the total will soar to 177 million during 2015. This will be equivalent to 19% of the total pay-TV subscriber base, up year-on-year from 14%.
Ovum projects that the global telco TV subscriber base will grow at a compound annual rate of 4% to 2020, compared with 2% across the wider pay-TV market, reaching a total of 210.4 million.
While IPTV will remain the dominant means of delivering telco TV, Ovum sees traditional cable and satellite platforms as also continuing to play a big role.
"The growing share of 'traditional' TV platforms within the telco TV base reflects a recent shift towards a global consolidation of pay-TV operations, in which telcos are playing a significant part," said Jonathan Doran, principal analyst, consumer telecoms, at Ovum and author of the report. "The jump in subscriptions during 2015 is comprised mostly of direct-to-home (DTH) satellite subscriber additions resulting from M&A initiatives. These include the acquisition by AT&T of DirecTV (US and Latin America) and Telefonica's purchases of Digital Plus in Spain and GVT in Brazil."
Yet Ovum anticipates that this trend – spearheaded by Vodafone's earlier acquisitions in Europe – will slow down, with the telcos' share of the overall pay-TV market stalling at 19-20%. Throughout the forecast period, around half of Telco TV subscriptions will be delivered via IPTV networks, with cable and satellite serving a projected 12% and 37% of connections, respectively, by 2020.
Ultimately, Ovum expects to see a continuation of today's telco TV platform mix, at least for the foreseeable future. It anticipates that operators will exploit a combination of technologies that includes traditional cable, satellite and IPTV, as well as the rapidly evolving mobile OTT and hybrid delivery channels.
While the flurry of M&A activity has boosted numbers of Telco TV connections over cable and satellite, IPTV is also still growing, both organically and via gradual migration from traditional platforms," Doran added. "The choice of delivery technologies is a strategic decision that will vary according to each operator's position within a given market ... The recent spate of telco acquisitions of established pay-TV operations in Europe, the US, and Latin America has firmly cemented the telcos' presence within the wider pay-TV market and we expect this to continue growing steadily."