Advanced Television

Eutelsat underlines video’s importance

February 22, 2018

By Chris Forrester

Many critics and commentators suggest the ‘end is nigh’ for satellite’s role in delivering video to consumers who are – say the critics – increasingly turning to wired suppliers for their entertainment.

Eutelsat (and its rival SES) has continually stressed this is not how they are experiencing the market. While capacity orders are under pressure in some markets from the shift to higher compression rates, and the switching from dual-emissions (of Standard as well as High Definition, SD/HD) and the curtailing of some SD contracts, the general state of their Video segment is extremely healthy.

This was the message from Eutelsat’s senior staff at a London ‘road-show’ with investors on February 20th.

A report from equity analysts at investment bank Jefferies says that Eutelsat’s management “Reiterated its target for Video to be stable to slight growth; the backlog compression is partly a function of shorter contracts (which Eutelsat does not push back against as it represents a means of injecting pricing power).”

“[Its] Hotbird channel count, excluding the vagaries of sports events, has been stable; Italy is an attractive market for Eutelsat – fibre is in the big cities only – it’s a difficult country to cover with fibre given population density and geography – if Sky Italia wants to get into more homes, it will need a dishless service (and has had one since May 2015) – Sky will negotiate hard in the upcoming [contract] renewal but “Eutelsat will resist it” – recent blue-chip customer renewals (namely, Polsat in Poland) give Eutelsat confidence to conclude a favourable renewal (Polsat annual revenue is up “significantly” post renewal); ‘We mostly have very big clients who take a lot of capacity – for the free to air broadcasters, we go through distributors’.”

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