Greek Telco WIND Makes Long-Anticipated Move Into Online Subscription Video

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Publication date: 25 Apr 2018 Author: Constantinos Papavassilopoulos Associate Director, Service Providers & Platforms

Greek telco WIND makes long-anticipated move into online subscription video

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Greek telecom operator WIND Hellas is to launch a new online subscription video service, WIND Vision. The operator is the first telco in Greece to launch such a service. WIND Vision will be offered via a hybrid Android TV set-top box supporting both online and terrestrial (DVB- T/T2) distribution of content. The launch also marks the first introduction of an Android TV box in the Greek market. The WIND Vision box supports content in 4K resolution and offers access to Netflix via a pre- installed app. Apart from TV content, the service will also offer games, music, and content from YouTube and Google. The new service will offer a total of 60 TV channels, covering all major Greek FTA TV channels, a selection of international channels across different genres and all six Novasports HD channels, following an agreement with Forthnet in late 2017. The offer of WIND Vision will comprise two packages: the Family Pack which will cost €9.90 per month and the Full Pack costing €24.90 per month. Our Analysis

The launch of WIND Vision has been long anticipated. It was initially planned for the end of 2017, but developments in the Greek telecoms market, and primarily the sale of CYTA Hellas and Forthnet played a critical role in postponing WIND Vision’s launch. WIND Vision is an important asset for the Greek telco's new business strategy, as it can support the fulfilment of a number of goals. First of all, the operator's launch of WIND Vision is strategically positioned to benefit from investments it is making in fixed and mobile infrastructure and networks. So far, WIND has invested €95 million in rolling out a new fibre broadband service, WIND Fiber, which offers broadband speeds of 100 and 200 Mbps. In parallel, the company has expanded its private 4G LTE network to cover more than 90% of the population in Greece. Going forward, the company is planning to invest up to €500 million between 2017 and 2022, particularly to expand its foothold on fibre and 4G LTE networks all around the country. As part of this expansion plan, WIND aims to increase its market share to 20% of the whole telecom market in Greece by 2022. Currently, WIND controls around 10% of the fixed broadband market and around 19% of the mobile broadband market. However, its mobile subscriber base is primarily 3G, as the operator currently claims a 5% share of mobile 4G subscribers in the country. Pay TV penetration in Greece is considerably lower than the rest of Western Europe, standing at 23.37% at the end of 2017. This factor has also contributed to WIND’s decision to launch an online video service in the country. WIND Vision is relatively well-positioned in the Greek pay TV market, as it controls premium sports content, via its carriage-agreement with Nova for the Novasports channels, and premium entertainment content through the carriage of Netflix. WIND Vision is also currently cheaper than Nova for both packages (entry package and full package). Pay TV competitor Cosmote TV, however, offers a similar pricing structure with that of WIND Vision’s, while both Cosmote TV and Nova have a richer channel portfolio (especially in HD format) than the current offer of WIND Vision. In general, the prospects for pay TV growth in Greece are good, despite the introduction of a new 10% tax on pay TV subscriptions, as Greece's free-to-air offering lacks quality and premium content. Furthermore, the Greek economy is expected to return to growth in the next five years, which is likely to promote a

higher consumer confidence in paying for entertainment services like pay TV and online subscription video. Meanwhile, the Greek OTT market is still somewhat nascent at the moment: while pay TV operators (Cosmote, Forthnet, Vodafone) have launched multiscreen services, available exclusively to their pay TV subscribers, none have launched a standalone online subscription video service comparable to Sky's Now TV in the UK. Interestingly, prior to WIND's launch, the only Greek company to launch a standalone online service was FTA broadcaster Antenna, which launched Ant1 Next in March 2017. ANT1 Next is priced at €2.99 a month and has exclusive scripted programming from the Greek TV series portfolio owned by Antenna, including box sets and catch up content. In addition to WIND's launch of an online video service, the Greek subscription video market will be re- shaped by the sale of Forthnet, the country's second largest pay TV operator after Cosmote. WIND already controls around 22.17% of Forthnet and together with Vodafone (which owns around 4%) has made a joint offer to acquire around 32.8% of the operator. It currently faces competing offers from Greek broadcaster Antenna Group (in partnership with the investment fund Providence), consultancy firm Odyssey Consulting Management, KKR's Pillarstone, and a joint offer from funds Golden Tree Asset Management and Cyrus Capital Partners. It is worth noting that the latter two funds are also major shareholders of WIND. Citation policy Request external citation and usage of Omdia research and data via [email protected]. Omdia consulting We hope that this analysis will help you make informed and imaginative business decisions. If you have further requirements, Omdia’s consulting team may be able to help you. For more information about Omdia’s consulting capabilities, please contact us directly at [email protected]. Copyright notice and disclaimer The Omdia research, data and information referenced herein (the “Omdia Materials”) are the copyrighted property of Informa Tech and its subsidiaries or affiliates (together “Informa Tech”) and represent data, research, opinions or viewpoints published by Informa Tech, and are not representations of fact. The Omdia Materials reflect information and opinions from the original publication date and not from the date of this document. The information and opinions expressed in the Omdia Materials are subject to change without notice and Informa Tech does not have any duty or responsibility to update the Omdia Materials or this publication as a result. Omdia Materials are delivered on an “as-is” and “as-available” basis. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in Omdia Materials. To the maximum extent permitted by law, Informa Tech and its affiliates, officers, directors, employees and agents, disclaim any liability (including, without limitation, any liability arising from fault or negligence) as to the accuracy or completeness or use of the Omdia Materials. Informa Tech will not, under any circumstance whatsoever, be liable for any trading, investment, commercial or other decisions based on or made in reliance of the Omdia Materials.