Ten post dostępny jest także w języku: polski
According to PMR data, in 2020 the pay-TV market in Poland will grow in value by 1% to PLN 6.2bn. On the other hand, PMR estimates the value of the VOD market at PLN 1.3bn, which translates into 25% growth year on year. The dissonance between the markets stems from the different degree of saturation with services, but also from factors that dilute ARPU from VOD services. In 2020, the COVID-19 crisis will paradoxically work in favour of the pay-TV and VOD services market.
VOD market isn’t cannibalizing pay TV? Why?
The pay-TV market in Poland remains stable, both in volume and value terms, although with a slight downward trend. The key factors are relatively low TV subscription prices, also for premium content (compared to European rates), and bundling of services, mainly with access to fast internet connection (the COVID-19 crisis only highlighted this trend). The strong position of pay-TV providers affects the VOD market in Poland, which, although developing dynamically, still has a large demand gap when it comes to access to paid services (limited consumer budgets). In 2020, the COVID-19 pandemic caused an accelerated growth in subscriptions to SVOD services. The coronavirus effect in this respect should also be visible in the short term. At the same time, PMR estimates that the growth in the number of SVOD subscribers is strongly restrained by the trend of account sharing, which will continue in the market also in the next six years.
Pay-TV market: value growth despite pandemic
According to PMR data, in 2020 the pay-TV market in Poland recorded a 1% growth in value to PLN 6.2bn. The market sentiment is positive despite a slightly downward trend in volume terms, similar to the year before (-0.1% y/y). This shows that the COVID-19 crisis had a neutral impact on the market, and in a way also a positive one, contributing to higher loyalty (lower churn rate) of pay-TV subscribers during the lockdown. In value terms, despite the weaker macroeconomic situation, pay-TV providers managed to increase ARPU from their services thanks to upselling of additional products and services (e.g. premium TV channel packages). This was partly due to the temporary availability of channels, including premium channels, from higher TV packages as part of the “open windows” during the first wave of the COVID-19 pandemic. The results of PMR’s research indicate that over the past year this has prompted some subscribers to purchase a more expensive TV package, including these channels.
PMR forecasts a slight decline in the pay-TV market between 2021 and 2026, both in volume (CAGR 2021-2026: -0.2%) and value terms (CAGR 2021-2026: -0.7%). The main trends that will dominate the market are further bundling of services and premiumization of the offer, i.e. development of premium products and services.
VOD services: SVOD services dynamize the market
The number of users of VOD services in Poland has been growing dynamically. This is due to the still low saturation of the local market with these services, mainly in terms of access to paid services. On the other hand, free services have already reached a certain mass, which allows to talk about high penetration. According to PMR data, a total of 9 million households will use AVOD services in 2020, which translates into 62% penetration. A year ago, however, the first decline was recorded in the number of households using AVOD exclusively. This is a result of greater migration of users towards paid VOD, mainly subscription services. Indeed, the COVID-19 crisis created additional demand for SVOD services. PMR estimates that nearly 900,000 new SVOD subscriptions were added in 2020, compared to around 500,000 the year before.
In terms of value, the VOD market is also gaining due to the growing volume and increasing ARPU. PMR estimates that in 2020 the value of the market will amount to ca. PLN 1.3bn, growing by 25% year on year. However, this is still well below the value of the pay-TV market (PLN 6.2bn in 2020). Of course, the degree of saturation with particular services varies. Besides, the VOD market is not dependent on the cyclical nature of subscription payments due to the contract signed with the service provider. It is also limited by the trend of subscription sharing within the SVOD segment, which dilutes ARPU from the service.
Between 2021 and 2026, PMR forecasts further growth for the VOD market, both in terms of volume – households (CAGR 2021-2026: 3.2%) and value (CAGR 2021-2026: 8.1%), although at a slower rate each year. The main trends that will dominate the market are the growing migration towards paid VOD services, mainly SVOD, further account sharing to subscription services or the increasing number of SVOD services per household (maximum 2 services by 2026).