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Video services, pay-TV and OTT set for big change

Consumer viewership of online video has dramatically increased in the past few years, and this trend will continue in 2012, according to a research note from Parks Associates. Parks said that this trend will impact ARPU and overall revenues for pay-TV operators and resonate throughout the content ecosystem in 2012. In the past twelve months alone, a full 12.7% of U.S. pay-TV subscribers downgraded their pay-TV service.

That does not mean that pay-TV operators will stand idly by. They will continue to explore new and creative ways to monetise their investments in VOD and multiscreen delivery systems as a deterrent to subscriber and revenue loss due to online video and OTT services. And, they're making progress: By mid-2011, 80% of U.S. pay-TV subscribers could receive on-demand content on a non-TV screen in their home through a service provided by their pay-TV provider. By the end of 2012, the impact of multiscreen offerings on subscriber churn and business models will be clearer to operators, Parks noted.

There are a few bright spots for pay-TV beyond multiscreen reach. Fuelled by growing economies and foreign investment (particularly from Western Europe), Latin America is a hotbed for television delivery systems and services, the firm found. Of all global markets, Latin America is the fastest growing market for pay-TV services, increasing by 18% between 2010 and 2011.

From the article, "Video services, pay-TV and OTT set for big change" by Michelle Clancy

 

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