The number of pay-television subscribers in Western Europe fell by over a third of a million during 2012, the first decline since the launch of commercial services in the 1980s. The fall is attributed to the economic downturn in the Eurozone, with the biggest losses in Italy and Spain.
While pay television has generally been considered relatively resilient to recession, the fall in subscriber numbers may be an indication of tough times rather than a fundamental weakening of the subscription model. The decline in numbers has yet to become a trend and there are significant differences by country.
Italy saw a fall of around 800,000 subscribers in 2012, to 7.9 million, with IPTV pioneer FastWeb following Wind in closing its television services and a fall in customers of Sky Italia. Spain lost 261,000 to reach 4.3 million. The figures for Germany fell by 180,000 to 21.5 million, while France was down slightly to 12.2 million.
In the United Kingdom, the most competitive television market in Europe, the number of subscribers by 190,000 to 14.4 million. Sky ended 2012 with 10.36 million television subscribers, an increase of 105,000 over the year. Virgin Media ended the year with just under 3.8 million television subscribers, a net increase of a modest 32,000 subscribers.
The other countries in Western Europe added a total of 670,000 pay-television subscribers to reach a total of 32.3 million.
There were 92.6 million pay-television subscribers in Western Europe in total at the end of 2012, a net loss of around 384,000, according to numbers from Informa Telecoms & Media.
“This is the first drop in subscriber numbers since pay-TV launched in Europe in the 1980s, so it is certainly a significant moment,” said Adam Thomas, the media research manager for Informa. “It’s a wake-up call to the industry that confirms pay-TV growth is no longer insulated against economic downturns. The heaviest losses were experienced in markets like Italy and Spain, where the Eurozone crisis has been hitting hard.”
However, Ted Hall, a senior analyst covering Western Europe, emphasized that the findings should not be overstated, due to specific fiscal circumstances affecting the market. “As economic recovery kicks in, pay-TV subscriber numbers will return to growth,” he predicted. “Indeed, we are forecasting that the pay-TV total will rise to 94 million this year, so, while the 2012 drop injects some caution, there is no suggestion the wheels are coming off the pay-TV bandwagon.”
The informa Western European TV report provides further details of television services across 15 key markets in Europe.