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According to the findings of The Pay-TV Innovation Landscape in Latin America, the fourth in a global series of white paper from the Pay-TV Innovation Forum, a global research programme from content protection provider NAGRA, in partnership with international research and strategy consultancy MTM, the region features solid growth potential yet accounts for less than ten per cent of the industry’s global revenue in terms of both TV households and revenues.
Despite limiting factors, such as poor broadband infrastructure, economic slowdown in some territories, piracy, and a strong free-to-air industry, the Latin American pay-TV industry has evolved significantly over the last five years. Most pay-TV service providers have been focusing on growing their core pay-TV proposition and gradually moving to IP-based services and OTT. Today, 75 per cent of service providers have IP-connected set-top boxes, 70 per cent have introduced multiscreen services and 16 per cent have launched unbundled OTT services.
Next-generation features were significantly less prevalent with only 14 per cent of service providers offering access to third-party OTT services, while none have commercially launched advanced services such as 4K video, content recommendations, or voice control.
In the context of a market that is already concentrated, with major international telco groups making up 50 per cent of all pay-TV subscribers while small-scale pay-TV operators and telcos represent just 18 per cent of market share, the white paper highlights the critical factors that will shape the industry over the next five years. It also emphasizes the need for data-driven consumer insights, flexible technology platforms and strategic partnerships with suppliers.
“Despite the challenges it faces, the pay-TV industry in Latin America has been able to develop competitive services like multiscreen and OTT to meet consumer demand–and all signs indicate that this trend will continue,” said Simon Trudelle, Senior Product Marketing Director for NAGRA. “It is now critical that service providers accelerate innovation to keep up with consumer expectations. With this in mind, we expect the region to increase investment in next-generation solutions as the industry faces the rise of international OTT players.”
“It is going to be fascinating to watch the region progress over the coming years as infrastructure, access to content and consumer behaviour continue to evolve,” said Jon Watts, Managing Partner at MTM. “There is no doubt that the region is poised for disruption, with new technologies setting the foundation for innovation, and growing consumer appetite for new services. The region has been steadfast in approaching the challenges it faces and, with the right strategy and partnerships, can enter a new phase of growth over the next five years.”
The white paper provides an analysis of the product and service portfolios of 44 pay-TV providers across the seven largest pay-TV markets in Latin America, accounting for around 63 million pay-TV households.