A report from investment bank Exane/BNPP states that its regular Satellite Monitor, just updated and expanded by some 15 per cent to include 1300 channels beams by SES and Eutelsat via more than 70 transponders over sub-Saharan Africa, shows a modest improvement in video capacity and usage.
“The Q3/19 edition of our Exane Satellite Monitor (ESM) shows that video capacity usage/demand has improved for SES with a return to broad stability (+0.3 per cent in net Mb/s consumed in Q3/19). While 19.2 East remains in decline (covering Western continental Europe), trends at 5E (Eastern Europe), 23.5E (Central Europe) and 28.2E (UK & Ireland) have improved,” noted the report.
“On the other hand, the ESM shows a deterioration for Eutelsat,” it added. “Year-on-year growth in video capacity consumption has turned negative in Q3/19. On the satellite beams we track, we estimate video consumption is down 2 per cent in Q3/19. This decline is in particular driven by a reversal in the recent positive growth performance of Hotbird where net Mb/s consumed are currently trending down by 2.6 per cent vs. Q3/18.”
The bank’s report says that Video DTH is still the key sustenance for Europe’s satellite operators. “We estimate that Video Distribution accounted for 49 per cent of SES 2018 revenues and 56 per cent of Eutelsat’s. Given the higher transponder pricing levels in the Video DTH segment, especially over Europe, we estimate that it accounts for 55-60 per cent of SES Group EBITDA20 (estimated) and 60-65 per cent of Eutelsat group EBITDA in FY20. Within Video Distribution, DTH accounts for the vast majority of both companies’ divisional revenues and profit in our view.”