Pwc Global Entertainment and Media Outlook 2014-2018 Belgium
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PwC Global entertainment and media outlook 2014-2018 Belgium 2 Summary 3 TV subscriptions and licence fees 4 TV advertising 5 Internet access 6 Out-of-home advertising 7 Newspaper publishing 8 Business-to-business 10 Radio 12 Video games 14 Filmed entertainment 16 Music 18 Magazine publishing 20 Books 22 Internet advertising Summary Entertainment and Media market in Belgium† (US dollar millions) 2013-18 2009 2010 2011 2012 2013p 2014 2015 2016 2017 2018 CAGR Entertainment and Media in Belgium† ‡ Business-to- 1,272 1,307 1,308 1,294 1,293 1,295 1,304 1,318 1,333 1,350 0.9 business Books 436 449 454 464 473 486 503 522 542 560 3.4 Magazine 998 1,037 987 964 947 938 929 923 916 909 -0.8 publishing Filmed 581 576 583 575 579 583 589 590 592 595 0.6 entertainment Internet access 2,195 2,354 2,631 2,842 3,011 3,174 3,314 3,440 3,568 3,693 4.2 Internet 401 432 469 521 590 651 704 750 789 832 7.1 advertising Newspaper 1,604 1,659 1,583 1,560 1,558 1,540 1,516 1,486 1,447 1,402 -2.1 publishing Out-of-home 273 291 322 321 344 361 376 391 406 421 4.1 advertising Radio 479 524 581 606 636 657 678 698 720 742 3.1 Music 603 599 573 541 514 498 485 477 472 469 -1.8 TV advertising 1,006 1,141 1,174 1,169 1,182 1,214 1,248 1,289 1,324 1,361 2.9 TV subscriptions 1,601 1,714 1,824 1,855 1,865 1,875 1,887 1,899 1,908 1,917 0.5 and licence fees Video games 381 393 415 418 437 455 467 479 487 496 2.5 Total 11,829 12,476 12,904 13,129 13,430 13,726 14,002 14,261 14,504 14,748 1.9 Total with double 11,829 12,476 12,904 13,129 13,430 13,726 14,002 14,261 14,504 14,748 1.9 counting Total without 11,047 11,613 11,983 12,159 12,407 12,664 12,897 13,118 13,321 13,526 1.7 double counting †At average 2013 exchange rates. ‡Note: Digital advertising components such as online television, online radio, digital newspaper, digital consumer magazine, digital trade magazine and digital directory advertising are included in the respective segments and in the Internet advertising segment but only once in the overall total to avoid double counting. In addition, consumer spending on radio licence fees is included in both the TV subscriptions and licence fees and the radio segment but only once in the overall total. Similarly, pay-per-view and video-on-demand revenues through a TV subscription are included in the TV subscription and licence fees segment and filmed entertainment but only once in the overall total. Note: Numbers shown are rounded. Totals may not equal the sum of their parts due to rounding. 2 PwC | Global entertainment and media outlook: 2014-2018 www.pwc.com/outlook TV subscriptions and licence fees The Belgian pay-TV subscription market is at saturation point With the return of football, the cable players have stemmed with 98.2% penetration, although an additional 100,000 the loss of subscribers to Belgacom. However, there is still households are forecast to be taking pay-TV by end 2018, the challenge of upgrading the many analogue cable reaching 4.8mn subscriptions. Cable TV currently has 68.4% subscribers to digital packages and increasing revenues. of all pay-TV subscribers with the operator Telenet dominant Cable operators are using the full arsenal of HD content, on- in Flanders and VOO strong in Wallonia. However, cable is in demand programming and triple-play services to encourage decline and will take 64.9% of the market in 2018. users to upgrade to digital. Belgacom’s IPTV services have successfully challenged The satellite platforms, which are principally owned by the cable, rising from 14.0% of all pay-TV subscribers in 2009 to M7 group, lack key sports and movie rights and have 26.3% in 2013, and are forecast to reach 28.8% in 2018. struggled with less than a 4% share of the market. Belgacom’s rapid rise has been attributed to date to football Public service broadcasting is administered by the VRT (in rights but, since the domestic Jupiler League became Flanders) and RTBf in Wallonia. In 2012, the Flemish and shared, it has found it harder to attract homes away from Walloon governments contributed more than US$600mn to cable. In response, Belgacom has secured rights to public radio and television. European Champions League football. TV subscriptions and licence fees market in Belgium† (US dollar millions) 2013-18 2009 2010 2011 2012 2013p 2014 2015 2016 2017 2018 CAGR TV subscriptions and licence fees in Belgium† Public TV licence 580 585 620 626 627 631 636 640 645 650 0.7 fees Subscriptions 1,021 1,129 1,204 1,229 1,238 1,243 1,251 1,259 1,263 1,267 0.5 Total 1,601 1,714 1,824 1,855 1,865 1,875 1,887 1,899 1,908 1,917 0.5 Total with double 11,829 12,476 12,904 13,129 13,430 13,726 14,002 14,261 14,504 14,748 1.9 counting Total without 11,047 11,613 11,983 12,159 12,407 12,664 12,897 13,118 13,321 13,526 1.7 double counting †At average 2013 exchange rates. Note: Numbers shown are rounded. Totals may not equal the sum of their parts due to rounding. 3 PwC | Global entertainment and media outlook: 2014-2018 www.pwc.com/outlook TV advertising TV advertising revenues in Belgium picked up between 2009 and 2011, before declining in 2012. Growth of 1.2% in 2013 saw revenues reach US$1.18bn and further growth will see them reach US$1.36bn in 2018, at a CAGR of 2.9%. There will be a very small shift to multichannel in this period, as its share rises from 11.1% of the total in 2013 to 12.5% in 2018.This causes terrestrial channels to dominate, as revenues rise from US$1.04bn in 2013 to US$1.17bn in 2018. The channels are concerned about the role of digital video recorders (DVRs) and the skipping of adverts. Private broadcasters charge advertisers based on live viewings and the ratings do not include DVR viewing. A number of broadcasters told cable and IPTV operators that their DVR services are destroying broadcasters’ business models and that an appropriate revenue should be allocated by the distributors of content (the operators) to the content providers (the public and private broadcasters). Due to the high penetration of digital TV and the fact that more than 60% of households in Belgium own a DVR, the potential loss of income for broadcasters due to time-shifted viewing is substantial. TV advertising market in Belgium† (US dollar millions) 2013-18 2009 2010 2011 2012 2013p 2014 2015 2016 2017 2018 CAGR TV advertising in Belgium† Broadcast advertising Multichannel 100 116 123 126 131 138 145 154 162 170 5.4 Terrestrial 904 1,023 1,048 1,038 1,045 1,067 1,090 1,119 1,142 1,167 2.2 Total 1,004 1,138 1,171 1,164 1,176 1,205 1,235 1,272 1,304 1,337 2.6 Online 2 2 3 4 6 9 12 16 20 24 30.2 Total 1,006 1,141 1,174 1,169 1,182 1,214 1,248 1,289 1,324 1,361 2.9 Total with double 11,829 12,476 12,904 13,129 13,430 13,726 14,002 14,261 14,504 14,748 1.9 counting Total without 11,047 11,613 11,983 12,159 12,407 12,664 12,897 13,118 13,321 13,526 1.7 double counting †At average 2013 exchange rates. Note: Numbers shown are rounded. Totals may not equal the sum of their parts due to rounding. 4 PwC | Global entertainment and media outlook: 2014-2018 www.pwc.com/outlook Internet access Belgium’s fixed broadband penetration rate is one of the In the early part of the last decade, Belgacom began rolling highest in Western Europe. As a result, the market will see out fibre closer to homes in order to offer IPTV services in only moderate growth between 2013 and 2018, rising from competition with the cable operators’ TV offers. More penetration of 84.9% in 2013 to 91.2% in 2018, driven by an recently, the incumbent announced further plans to upgrade increased take-up of bundled services. its network from 2014, starting with vectoring, a speed- enhancing technology that promises rates comparable with The incumbent Belgacom and leading cable operator Telenet those available via the cable operators’ DOCSIS 3.0-enabled dominate the fixed broadband market, jointly claiming over networks. 80% of households. In the southern region of Wallonia, where Telenet does not operate, Belgacom’s main rival is Adoption of mobile Internet is low in Belgium compared with another cable operator, Voo. other Western European markets, largely because operators have avoided subsidising devices as heavily as their Because of these duopolistic structures and the maturity of counterparts in other countries do. However, attractive the market, operators are largely focused on upgrading their bundles and the beginning of competition in the 4G sector services in order to win subscribers from each other, while will drive mobile Internet uptake from now on, with retaining their own.