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Pay-TV Innovation Forum reveals the 2018 priorities for European providers
  • 87% of European executives agree that product and service innovation, and digital business transformation are becoming more important for the European pay-TV industry
  • 80% believe the pay-TV bundles as we know them today will change substantially during the next five years
  • 93% see data-driven analytics as a major opportunity for the industry

Cheseaux, Switzerland – April 24, 2018 – NAGRA, a Kudelski Group (SIX:KUD.S) company and the world's leading independent provider of content protection and multiscreen television solutions, in partnership with MTM, a leading international research and strategy consultancy, today revealed the European findings of the Pay-TV Innovation Forum 2018. The research programme, currently in its third year, seeks to explore and catalyse innovation and growth across the global pay-TV industry.

According to a panel of European executives polled in March 2018, there is growing recognition amongst service providers that, while challenges remain in a maturing market, there are significant opportunities that can be leveraged. Of those surveyed, 87% agree that product and service innovation is becoming much more important to the industry, and that digital business transformation will be crucial to securing their future.

The pay-TV industry is growing more competitive and diverse, stimulating innovation and investment in many areas. Industry participants recognise that traditional pay-TV service providers are now operating in the “post-OTT” pay-TV landscape, encompassing a variety of paid content offerings delivered over a range of networks and consumed over multiple screens. Industry executives cite content owners going into direct-to-consumer distribution, new forms of bundles integrating content and e-commerce services, and growth in online streaming piracy, particularly in Southern and Eastern Europe, as key developments that will shape the European pay-TV markets over the next few years.

To adapt to the new pay-TV landscape and changing consumer demand, industry executives identified four innovation priorities that European pay-TV providers should focus on to remain competitive and grow their businesses:

  • New ways to package and price content: 80% of participants now believe that the pay-TV bundle as we know it today will be disrupted and will see significant change over the next five years. The most attractive new packaging methods identified include new linear and non-linear content bundles, content-led packages in various genres, such as sports, film, and kids, skinny bundles, new content-device-telecom bundles and a second wave of content-re-aggregation that will make consumers’ lives easier. Providers also expect to be able to harness new data analytics capabilities to improve customer segmentation and offer a more personalised service.
     
  • Next generation user interface and user experience: With an increasing volume of content available on pay-TV platforms, providers will need to leverage new data analytics capabilities to enhance their content discovery and recommendations engines. Executives also identified linear and on-demand content integration, unified search and voice control as key features within the user experience that will have the most significant impact on the European pay-TV industry over the next five years.
     
  • Stronger and more diverse portfolio of content propositions: European pay-TV executives identified numerous opportunities to expand their content portfolios to attract users, including production of original and exclusive content, content localisation and the development of new formats and programming, such as eSports. Strategic partnerships with content owners will be core to developing these portfolios, with 80% of respondents seeing them as a top strategic priority for pay-TV providers.
     
  • Harnessing data to transform the business: 93% of executives agreed that data-driven analytics presents a major opportunity in their business transformation efforts, particularly when leveraging state-of-the-art data platforms and models to improve performance, enhance decision-making and optimise investment strategies. Respondents noted that churn reduction, customer service, personalisation and targeted advertising delivery would be the key areas where data analytics would add the greatest value to pay-TV businesses.


“It is promising to hear that pay-TV executives are no longer just seeing the threats to their business, but identifying the new opportunities available to them that will lead to further revenue growth,” said Simon Trudelle, Senior Director, Product Marketing, NAGRA. “There is strong consensus that future growth will be enabled through investments in their products and in digitising their business to meet the demands of customers who increasingly want a more personalised experience from their providers.”

“With disruption and competition intensifying, pay-TV industry participants need to think carefully about new strategies, business models, product portfolios, and technologies that will help them maintain and grow their business,” said Jon Watts, Managing Partner, MTM. “It is an exciting time for the industry as more and more providers start to recognise and adapt to the new “post-OTT” pay-TV landscape.”