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Australia - Video Streaming, Broadcasting and Pay TV

Australia - Video Streaming, Broadcasting and Pay TVConsolidation in Australia’s VOD Market Begins

Australia’s leading pay TV provider FOXTEL during the last few years has struggled to increase pay TV penetration in Australia. The market has also seen the launch of competing OTT platforms, including Stan and Netflix. These offer competitively priced basic packages, commonly below AU$10 per month letting consumers’ view content at a time of their choosing. Traditional TV viewing patterns continue to fall gradually in Australian households, and the advent of OTT viewing as well as IPTV will see a more rapid shift from linear to time-shifted TV in coming years.

The distribution advantage held by FOXTEL is slipping away as the NBN becomes built out over a greater number of premises, so expanding the reach of capable broadband infrastructure which enables subscribers to access OTT and IPTV content.

Following the end of analogue broadcasting, Australians have been able to access many more Free-to-Air TV channels as digital broadcasts. Although there are more channels available, the number of viewing hours has remained relatively stable for a number of years, and as a result individual channels, and particularly specific shows, have seen declining viewer numbers. Viewing habits have also been affected by the advent of catch-up TV services, which are available from the main broadcasters. In addition, subscription video services from operators such as Stan and Netflix are further eroding live TV viewing as subscribers choose instead to watch programs at a time of their choosing.

There are two major categories of paid online video content: Pay-per-view video-on-demand (PVOD) and subscription video-on-demand (SVOD) services. SVOD has emerged as the major category of paid online content in Australia. The global streaming revolution is gathering pace. Streaming is closing in on broadcast TV. The entry of SVOD providers Netflix, Presto TV and Stan saw a rapid update of SVOD services. This rapid increase in the rate of adoption of SVOD is occurring where high quality broadband is already available. The NBN will accelerate this trend as the mass deployment of high quality (fibre) broadband takes place via the NBN and will significantly decrease cost of delivery of SVOD.

The Internet now rivals broadcast TV as a vehicle to deliver consumer content. Its shift in user behaviour continues to drive change in the TV and media industries, prompting a move away from old formats and business models and ushering in an era of high-quality, on-demand entertainment. The broadcasters have been late entering the market - their focus has been on protecting their traditional business which are under threat from declining revenues, rather than on establishing a strong foothold in the SVOD market. Amongst the existing pay TV or free-to-air subscriptions there will be increased pressure on profitability as competition for content pushes up the cost of licensing. One of the few options left for broadcasters (and other traditional media companies) is to merge, in order to cut costs and increase their customer base.

In addition to Free-to-Air TV, pay TV is also under increasing structural pressure from SVOD providers such as Netflix. Fetch TV is emerging as a strong competitor to the incumbent Foxtel. Slowly but surely the NBN is being rolled out and this is something that also benefits Fetch, whose services are delivered via broadband. This distribution media supplies a great opportunity to offer an alternative to Australia’s leading pay TV service Foxtel.

With such a large number of national and international players competing consolidation is starting to take place. Quickflix has been forced to exit the market in 2016, followed by Foxtel’s Presto service later on in that year. BuddeComm predicts that the rate of SVOD growth moving into 2018 and 2019 will begin to taper off and eventually level off in around five years time.

Key Developments

Smart TV, pay TV, digital TV, subscription television, FTA TV, subscribers, penetration, additional subscription streams for subscribers, ARPU, revenue

Key companies mentioned in this report:

Telstra, Optus, FetchTV, Bigpond, Google, Apple, iiNet, ABC, Netflix, Foxtel, NBN Co, Quickflix, Hulu, AUSTAR, FOXTEL, Optus, TransACT, SelecTV, Telstra, TV Plus,, Presto TV, Stan, Australian Broadcasting Corporation (ABC), Special Broadcasting Service (SBS), Seven West, Nine Entertainment, TEN, Free TV.


  • EXECUTIVE SUMMARY
  • BROADCASTING TRANSFORMATION - SMART TV, PAY TV AND DIGITAL TV INSIGHTS
    • BROADCASTING CHANGING BEYOND RECOGNITION
    • MARKET ANALYSIS
      • Cloud computing and broadcasting
      • Broadcasting is moving to broadband
    • DIGITAL TV
      • Digital TV market overview
        • Table Global - digital TV households - 2009 - 2016; 2020
        • Table Global - digital TV market share - 2006; 2009; 2011 - 2015; 2020
        • Table Top 10 countries - digital TV households - 2014
      • Summary of key trends
    • PAY TV
      • Table Global - pay TV subscribers - 2010 - 2019
    • CABLE TV
    • OTT AND CORD CUTTING - USA
    • HDTV
      • HDTV market overview
    • ULTRA-HD/4K TV
      • 4K to drive bandwidth demand to gigabit levels
    • THE SMART OR CONNECTED TV
      • Introduction
      • Digital media players connecting smartphones to TVs
      • Smart TV threatens broadcasters
  • PAY TV, FREE-TO-AIR TV - STATISTICS AND ANALYSIS
    • THE PAY TV MARKET
      • Market trends in 2017
      • Industry overview
      • Subscriber statistics
        • Table Pay TV subscribers, Foxtel, others and total - 2008 - 2017
        • Table Pay TV subscribers - annual change by major operator - 2008 - 2017
        • Table Pay TV subscribers - annual change by major operator (historic) - 1997 - 2014
        • Table Historic - AUSTAR pay TV subscribers - 2008 - 2011
      • Consumer penetration statistics
        • Table Pay TV household penetration rates - 2005 - 2017
        • Table Historic - Pay TV household penetration rates - 1997 - 2004
      • Usage Statistics
      • Revenue statistics
        • Table Historic - Pay TV revenue by major operator - 1997 - 2004
        • Table Pay TV revenue by major operator - 2005 - 2016
        • Table Historic - Percentage change of pay TV revenue by major operator - 1998 - 2004
        • Table Percentage change of pay TV revenue by major operator - 2005 - 2016
      • Advertising revenue
        • Table Subscription TV advertising revenue and annual change - 2000 - 2016
      • ARPU and churn Statistics
        • Table ARPU levels per operator AUSTAR versus FOXTEL - 2003 – 2016
        • Table Pay TV industry annual churn rates - 1996 - 2016
      • Infrastructure statistics and Availability
    • FOXTEL
      • Company information
      • Company analysis
      • Operational results
        • Table Total FOXTEL and wholesale subscribers - 2012 - 2017
        • Table Historic - FOXTEL and wholesale subscribers by annual change - 2012 - 2014
        • Table Historic - Subscriber annual churn rate - 2002 - 2014
        • Table Historic - FOXTEL and wholesale subscribers - 2002 - 2011
        • Table Historic - FOXTEL and wholesale subscribers by annual change - 2003 - 2011
        • Table Historic - FOXTEL subscribers by type - 2008 - 2012
      • Financial results
        • Table FOXTEL - Key Financial Indicators - 2015 - 2016
        • Table FOXTEL - Key Financial Indicators - 2014 - 2015
        • Table FOXTEL - Revenue and Net Income - 2012 - 2015
        • Table FOXTEL - Revenue and Net Income (US$) - 2012 - 2015
        • Table FOXTEL monthly ARPU - 2003 - 2016
      • Acquisitions, alliances and subsidiary companies
        • Table AUSTAR key operating and financial figures - 2009 - 2012
      • Products and Services
      • Company history
    • THE FREE-TO-AIR TV MARKET
      • Trends and analysis
      • Impact of SVOD on traditional TV
      • Major FTA Providers
        • Table Number of television and radio licences on issue
      • Usage Statistics
        • Table Preferred Entertainment Activities- 2012; 2016
      • Advertising market statistics
        • Table Historic - Percentage shares of capital city TV advertising market - 1998 - 2015
        • Table Historic - Metropolitan advertising revenue for FTA commercial networks - 2009 –2015
        • Table Historic - Regional and total advertising revenue for FTA commercial networks - 2009 – 2015
  • VIDEO STREAMING - KEY MARKET INSIGHTS
    • FIXED AND MOBILE SERVICES
      • Definitions
      • The video streaming market
        • Table Global IPTV subscribers - 2010 - 2017
      • Online video media
        • Table Global OTT video streaming revenue - 2015; 2021
      • Video-On-Demand services
      • Industry insights
      • Brief case studies
        • Table Netflix subscriptions - 2011 - Q1 2017
        • Table Netflix consolidated revenue - 2009 - Q1 2017
      • Video streaming over mobile networks
    • MAJOR PLAYERS
      • Definitions
      • Introduction
      • AFLTV
      • Australian Broadcasting Corporation (ABC)
      • Apple TV
      • BBC iPlayer
      • FetchTV
        • Table Total number of Fetch TV subscribers 2012 - 2016
      • Foxtel
      • Freeview
      • Getflix
      • Google
      • Hayu
      • Hulu
      • Netbay IPTV
      • iiNet/TransACT
      • Netflix
        • Table Average SVoD streaming speed by ISP - 2015
      • Ninemsn /Nine
      • Optus TV
      • Quickflix
        • Table Quickflix subscribers - 2008 - 2015
      • Special Broadcasting Service (SBS)
      • Seven Network
      • Stan
      • Telstra Media
        • Table Telstra cumulative T-Box device sales - 2011 - 2014
      • TPG
      • Dendy
    • MOBILE VIDEO STREAMING
      • Introduction
      • Definitions
      • Impact of SVOD on traditional TV
      • Impact of SVOD on the Pay TV Market
      • SVOD Market Sizing and Subscribers
      • Inhibitors to SVOD Market Growth
      • Global Trends
      • SVOD Market Trends
      • Consumer Usage Trends
      • Market Analysis
      • Other Market Research Studies and surveys
        • Table Forecast - Television households and subscriptions in Australia - 2014 - 2019
  • DIGITAL RADIO
    • MARKET OVERVIEW
      • Introduction
      • Market Analysis
      • Market statistics
        • Table Estimated size of digital radio listening audience - 2009 - 2015
        • Table Cumulative digital device sales - 2009 - 2015
      • Digital radio still being trialled regionally
      • Regional deployment of digital radio
      • Digital radio as a supplementary service
      • Challenge from mobile broadcasts
      • The radio stations
      • Retailers and digital radio
      • Community digital radio gains broadcasting funds
        • Table Funding of digital radio community radio - 2009 - 2016
      • Digital radio provided in vehicles increasing
        • Table Digital radio sales in vehicles - 2011 - 2015
      • Digital radio coverage extended in some metropolitan areas
      • Regulatory developments
      • Agreement on new Digital Audio Broadcasting (DAB) standard
    • FEATURES AND BENEFITS OF DIGITAL RADIO
      • Reception quality
      • Text, images and data
      • Visual radio
      • Music downloading
      • Greater programming capacity
      • Traffic information
      • Advertising
      • Pay radio
      • Internet radio

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