Pay-TV Landscape (Turkcell & Turk Telekom)

Folllowing up the earlier post regarding the 2016 year end TV results of Turk Telekom and Turkcell, herebelow you can find the latest market figures of Q1 of 2017.

It’s seen that both companies are growing their TV base constantly on the past few quarters. The figures of both companies are presented on 2 pillars.

  • IPTV (Turkcell) & Tivibu Home (TT)
  • OTT (Turkcell) & Tivibu Go (TT)

Due to nature of the user behavior and landscape, there are 2 main difference regarding these 2 verticals:

  1. Big TV Screen Experience via STBs: Watching habits on big TV screen experience is conventional. The relationship between the audience and TV screen is several decades old. People even the young generations are watching their favorite shows preferably on big TV screen. Operators are subsidizing STBs and providing them to their customers on a rental basis. Unless modeled otherwise, main TV subscriptions are signed based on 2 years contract hence allowing operators perform financial planning relatively in a more controlled environment. Additionally, average watching time per day is several hours (6-8 hours) and consecutively ad revenues are huge on TV business. On the other hand, STBs have limited resources such as processing power and memory. The average lifetime of STBs are around 7 hours which means that today a quite old devices are still installed on customer promises. That’s why the overall experience and fluidity of the UI on big TV screen is not in a best shape compared to superfast, quad-core mobile devices. ( i.e. iPhones, Samsung Galaxy series)
  2. OTT TV Experience via mobile clients & PC and other players: The superior mobile broadband LTE infrastructure coupled with the ever increasing processing power of the mobile devices has made the TV/video watching experience much move convenient on handheld devices. Nevertheless, watching TV on a mobile, tablet or even a PC screen is not able to offer the best TV watching experience. Likewise, providing very high quality video like 4K Ultra HD is also not feasible due to both hardware limitations and the lack of screen support on mobile devices. On the positive flip of the coin, operators don’t need to provide OTT devices to the subscribers as they are bought my the customers either via retails shops or any other means. One other difference on OTT space, compared to Big TV screen experience is that there is significant churn ratio as there is no contract signed by the customers and cancelling the subscription is possible at any given time. That’s why customer acquisition and retention is more challenging on OTT space.

All in all, both Turkcell and Turkl Telekom are main drivers of Pay-TV market in Turkey. The other players in the competition (Digiturk, D-Smart, KabloTV and Filbox) are more less steady at a level since several years. The growth of Turkcell TV+ is mainly driven by IPTV product and the power of Turkcell’s LTE technology while Turk Telekom is heavily investing to scale TV’s offer on satellite domain and DSL base.

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