New SNL Kagan Analysis Predicts Global Multichannel Hypercompetition

Three-quarters of the world’s leading media markets will experience dramatic transformation in the next five years.

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Global multichannel competition and the emergence of hypercompetitive markets

Monterey, Calif. (Vocus) July 7, 2008

A new SNL Kagan study, “Global multichannel competition and the emergence of hypercompetitive markets,” examines the increasing competition in the global multichannel TV market and its impact on the evolution of pay-TV services.

According to SNL Kagan, cable accounted for 78% of total multichannel households and 58% of multichannel revenues in 2007. Despite cable’s current dominance, SNL Kagan predicts that the emergence of multiple digital platforms will create a hypercompetitive environment – four or more digital video distribution platforms – in 54 of the top 75 markets by 2013.

The SNL Kagan study shows how telcos are exploring and deploying video services globally. Under certain market conditions, telco IPTV systems have advantages over both cable and DTH (direct-to-home satellite) incumbents. Lack of broadband infrastructure is challenging DTH operators, driving them to utilize broadband pipes. Digital terrestrial television (DTT) and hybrid DTT-IP systems are adding to the competitive mix. To combat this competitive surge, cable operators are increasingly leveraging digital capabilities to provide services such as video-on-demand, dynamic electronic program guides and HDTV.

“The global pay-TV landscape is undergoing a transformative period with nearly three-quarters of the world’s leading media economies positioned for heightened competitive action,” said Ben Reneker, senior analyst with SNL Kagan.

SNL Kagan’s analysis expects additional multichannel platforms in 40 of the 75 leading markets. The greatest growth in the use of digital platforms is forecast in Asia and Latin America, where the number of countries with hypercompetitive multichannel markets will increase from six to 12 by 2013.

By 2013, Eastern European markets, with dynamic growth and new investment, are expected to have the world's highest average number of digital multichannel platforms, at 5.5. Russia is positioned to be an especially active market, accounting for more than half of Eastern Europe’s multichannel net additions between 2007 and 2013.

According to SNL Kagan, the six Asian countries set to join the hypercompetition scene by 2013 are Thailand, Singapore, South Korea, Indonesia, New Zealand and the Philippines. In Latin America, the six markets projected for multichannel hypercompetition are Chile, Colombia, Panama, Bolivia, Ecuador and Peru.

To view the number of countries in each region with four or more digital multichannel platforms, see the attached document.

Studies such as "Global multichannel competition and the emergence of hypercompetitive markets" are available exclusively as part of the SNL Kagan Information Service. For more information on this study and other media and communications data sets within the SNL Kagan Information Service, call 866.296.3743 or email SNLKaganSales @ snl.com.

About SNL Kagan
SNL Kagan, a division of SNL Financial LC, is a comprehensive resource for financial intelligence in the media and communications sector, including the broadcasting, cable, entertainment, motion picture, telecom, wireless, satellite, publishing and new media industries. The SNL Kagan suite of products integrates breaking news, comprehensive data and expert analysis into an electronic database available online and updated around the clock. For more information, visit http://www.snlkagan.com.

About Kagan Media Appraisals
Kagan Media Appraisals, the consulting arm of SNL Kagan, offers custom studies, white papers, briefings, business plans, research reports and appraisals from SNL Kagan’s team of expert analysts. KMA is recognized industrywide for actionable advisories, expert opinions, best practices, regulatory assessments and market data. Contact KaganConsulting @ snl.com or 831.624.1536 for more information.

Visit the SNL Press Room at http://www.snl.com/press_room to learn more about resources available to members of the media.

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