Both Turkcell and Turk Telekom announced 2016 year end results. You can see their TV offers‘ associated slides herebelow. Please click the image to see it in better resolution.
In Turkey, the broadband fair usage policy was one of the most critical barriers that was kind of slowing down the penetration of OTT services.
If one’s broadband consumption per month is above a certain limit (typically 50 GBytes) then the fair usage policy is becoming active and the bandwidth is limited by 3 Mbps no matter to what broadband package you are subscribed to. (Please see below picture) The notification of TT seen below could be translated as: „As you exceeded the monthly fair usage threshold your broadband speed is updated as 3 Mbps on the remaining days of the month. Starting from the beginning of next month your broadband speed will be set based on your subscription package.“
Due to this limitation, it was quite challenging to secure the QoE on OTT service. Also, reaching to the fair usage threshold is just a matter of days if you watch Live TV channels through internet. This has discouraged service provider in Turkey to offer OTT box type of solutions like Now TV in UK.
Fortunately, the fair usage policy is changing this year. According to the BTK’s new regulation starting from 1st of May 2017, the broadband speed after fair usage quota will be adjusted based on one’s original speed. Also, consumption from 2 AM to 8 AM will be out of scope for fair usage quota limitation. Regarding the table below, if one’s broadband bandwidth subscription is from 16 Mbps to 24 Mbps the speed will be set to 8 Mbps instead of 3 Mbps after the fair usage threshold.
I think this is really a key step forward for OTT services. The consumers of OTT services shouldn’t be worrying if they are off-limits as the limited speed is quite still sufficient for typical use cases.
This marks the end of the 3rd year of my dear blog turkishtvmarket.info 🙂 As a kind of tradition, I list down the most popular posts of the year. Herebelow you’ll see the most read top 10 posts of 2016 in order.
- Bein completes takeover of turkish super lig broadcaster Digiturk
- Turkish TV market training course in a nutshell
- Tivibu figures as of end of 2015
- Turkcell TV+ continues its fast growth
- D-smart’s OTT service D-smart-Blu rebranded as BluTV
- A total of 8 euro 2016 games will be broadcasted in 4k Ultra HD resolution on TRT 4K
- Turkcell TV acquired content rights of English premier league for 3 years
- My two cents about Turkish TV market
- Turkcell Superonline celebretes 1 million broadband TV customers
- Netflix Turkey launch aftermath
Turkcell Superonline fiber internet service and Turkcell TV+ service have both surpassed 1 million subscriber threshold. The homepass for fiber broadband service is 2,6 million households now in 15 cities out of 81 cities in Turkey.
In order to celebrate this milestone, during December 2016 Turkcell will be upgrading the broadband speed of all the customers to 100 Mbps bandwidth. Similarly, Turkcell TV+ users will be authorized to watch all the channels independently form their content package within December. You can watch the press release video here. (in Turkish)
Turkcell’s multiscreen TV platformu Turkcell TV+ has reached 1 million customers as the end of October. Thanks to the 4.5 technology the average watching time on mobile clients has reached to 28 minutes per day. The total download of the mobile Android and iOS clients already reached to 2.5 million. Premier League and NBA official broadcaster Turkcell TV+ is also delivering 2 4K Ultra HD Live TV channes together with the brand new 4K STBs.
100 thousand customers with a single invoice
Turkcell is offering a special bundle package that includes a complete set of solutions. It has 50 Mbps limitless internet (with a 125 GB fair usage quota) 4 GB mobile broadband, 500 minutes voice, 1000 SMS, and Turkcell TV+ offer, This complete package only costs 99 TRY. This package already had 100K subscribers in quite short time.
I’ve been teaching a course in Kadir Has University Istanbul/Turkey at Communications Faculty, New Media department. This semester is the 3rd time I’ve been teaching the course called as „Digital Platforms„. Every semester, there is one midterm and one final exam. If you like you can see the exams of earlier years herebelow.
This week, we had the midterm exam for this semester 2016 Fall. I’ve copied the questions and potential answers as below.
KADIR HAS UNIVERSITY
NM 423: DIGITAL PLATFORMS
FALL 2016 MIDTERM EXAM
- Pay-TV platforms:
a.) List down all the pay-TV platforms available in Turkey together with number of up-to-date subscribers? Also you should mention about the media they are using (satellite, IP etc.) (10 points)
- Digiturk (Satellite) : ~3 million subs
- Teledunya (Cable) : ~1151K subs
- D-Smart (Satellite) : ~925K subs
- Tivibu (IP+Satellite) : 545K subs
- Turkcell TV+ (IP): 303K subs
- Filbox (Satellite) : 35K subs
b) Considering the new Football League Broadcasting rights tender that will take next week which one is more likely to win and why? Please explain with solid arguments. (10 points)
As I’m currently a Turkcell employee, I’d prefer not to comment on this hot topic in order to avoid any misinterpretation 🙂
- OTT-1 : If I were somebody totally unfamiliar with the term OTT (Over-the-top) TV, how would you explain to me what it is and how it has changed the TV industry as a whole? (20 points)
OTT TV could be defined as the delivery of video content over the open internet without the involvement of any telco in the control. OTT TV has changed the TV industry in significant ways.
It allowed content providers/aggregators to deliver their content/services directly to end users. As opposed to the legacy cable or satellite businesses where the Pay-TV operators needs to make a significant amount of investment, OTT TV providers don’t need to have their own infrastructure. They don’t need to worry about scalibility. They are simply benefiting from the existing pipes of legacy telcos which enabled them to achieve very fast Time to Market periods. As a result, end users had a variety of alternatives on top of old DTH services which lead the new concept of ‘cord-cutters’. Incumbent DTH and cable operators first saw OTT TV providers as a threat. They then started increasing to lose customers. On the last few years they started to see them as potential partners to enrich their content offering.
- OTT-2: Globally who is the greatest digital video platform? What makes it the greatest one? What are the competitive advantages compared to the other alternatives? Please explain with solid arguments. (20 points)
Obviously YouTube is the greatest digital video platform in the world. Every minute 60 hours of video is uploaded to YouTube. Even this simple data tells us about the variety and richness of YouTube’s content portfolio. YouTube who is a Google company comes as an native application on Android phones. Hence, it has a dramatic competitive advantage in terms of engagement compared to the other alternatives such as Vimeo, Dailymotion etc. Also YouTube is accessible from a lot of consumer electronic devices which serves as another booster to customer interest. YouTube has lots video channels that users could subscribe to and in return generate revenue for the content owners based on the number of views. This allowed content providers to create their own ecosystem that is constantly growing. YouTube which its ever evolving User interface provides a nice, simple and convenient user experience which is consistent through all different devices. Today YouTube allows content providers to upload 4K, 360 VR and even HDR contents and simply the most advanced digital platform.
- Netflix: There are lots of OTT services available in Turkey i.e. Tivibu, DigiturkPlay, BluTV etc. Among these Netflix has a unique position? What makes Netflix so special? What are the competitive advantages compared to the other alternatives? Please explain with solid arguments. (20 points)
There are a certain number of reason why Netflix is special. First of all, it’s the only global SVOD service . Thanks to having tens of millions of active users Netflix could collect user data from all over the world and benefit those for constantly improving the user experience it’s delivering. It’s far beyond the competition in terms of recommendation engine and personalization. Additionally, it’s hosting Netflix Originals content. In other words, it’s beyond a content aggregator, it’s producing content. (House of Cards, Narcos etc.) Netflix has a superior technology that is allowing to deliver enhanced video quality coupled with its own CDN infrastructure. Netflix is available on a lots of consumer devices which increases the engagement of its subscribers significantly. It’s one of the global lovemarks whose bandwidth usage in USA is more than 37% at peak times. It’s content library in Turkey is hosting more than thousands of TV shows and movies. Having said all those advantages, it’s a known disadvantage. It doesn’t offer neither Live TV nor premium sports content unlike Digiturk etc.
- Smart TV: There are a number of popular Smart TV brands on the market i.e. Samsung, Sony, LG, Arcelik, Vestel etc. Some of the Pay-TV operators (Digiturk , Tivibu etc.) are also offering Smart TV applications as an alternative to STB solution. Nevertheless, what we are witnessing is there is no real success story on the market. What are the main reasons for this? Why Smart TV app of Pay-TV operators did not attract huge interest, why they are still deploying STBs? Please explain with solid arguments. (20 points)
The main reason is the lack of internet connectivity of the Smart TVs. Typical Turkish audiences is seeing TV sets as big monitors rather than expecting the similar level of smartness like mobile phones. If Smart TV is not connected or the internet connection is not reliable it’s not feasible to deliver a service-grade TV service to paying customers. Secondly, there is a huge amount of fragmentation on Smart TV space. There are lots of different TV brands most of them having their own technology stack and dependencies. Also the average life cycle of Smart TVs are around 7 years which makes it quite inefficient to maintain old legacy TV platforms. In general, Pay-TV operators are willing to design and deploy their own unique user experience (with well defined, tested UI and remote control). However, Smart TV apps mostly depend on the performance and limitation of TV sets which is very complex to keep under control. The overall experience is defined mostly by the Smart TV manufacturer. Lastly. if any customer happens to experience a major issue regarding the service quality or for various marketing reasons, operators would like to manage the customer device (ideally remotely). This is relatively easier to handle with STBs instead of TVs designed and produced a 3rd party.
Turkcell TV+ has reached 1 million users. This is the total of OTT and IPTV active users. Today, Turkcell TV+ IPTV service is available more than 323K households. Turkcell TV+ IPTV service is only available to fiber broadband users including the 4K Ultra HD service (TRT 4K and Funbox 4K Live TV Channels and lots of 4K content on YouTube TV).
On fiber residential segment, multiple play with TV has become 34% as of Q3 2016. For details please check the presentation on Turkcell Investor Relations website.
As being part of the Turkcell TV+ Technical team, it was a day full of proud. We’ve celebrated 1 million user milestone yesterday at the office with a small party.
In the past, I’ve posted a number of articles about the growth story of Turkcell TV+ starting from the commercial launch 2 years back. If you’d like to have a look, herebelow you can find the links to previous posts.
- Turkcell introduces the future of tv with its expanded Turkcell TV+
- Turkcell TV+ continues growing full speed
- Turkcell TV+ continues its fast growth
- Turkcell TV users will watch Euro 2016 in 4K Ultra HD Resolution
- Turkcell TV acquired content rights of English Premier League for 3 years
Yesterday, the president of Turkish Football Federation(TFF) announced that the new tender for the content rights of Turkish Football League will be issued on 25 November 2016.
The RFQ specifications will be announced around the end of this month. As of today, 5 local and 1 European company has completed their application to participate to the tender. The local ones are probablyTurkcell, Digiturk, D-Smart, Turk Telekom and Vodafone. The validity for the new tender will be probably 4+1 years starting from 2017-2018 football season.
The federation is expecting the tender to be finalized around 600 million USD per year. The legacy content owner Digiturk has acquired the rights at the expense of 321 million USD per year (424 million USD including taxes, federation fee and organization fee) in 2010. Demiroren stated that they decided to decrease TFF’s fee from 12 percent to 4 percent. It’s unclear that the declared expected quotation of 600 million USD is including all the costs.
It’s been emphasized that TFF is cooperating with consultants who actively worked on Premier Leauge’s tender. Obviously, TFF will target to maximize the revenue. Hence, it will be no surprise if they design the tender similiar to Premier League case.
At the beginning of September when the Premier League starts Turkish audiences had an puzzling situation since it was not clear enough which Pay-TV operator had the content rights. Digiturk which was the legacy owner of the rights did not have it for this season at that time. It was a local company called Saran Media who had the rights for Turkey region. At first, Digiturk and Saran Media could not come to an agreement. Later on D-Smart announced that they had the rights of EPL. Shortly after both Turkcell TV+ and Digiturk acquired the media rights for 3 years.
Herebelow I’d like to share the insightful analysis of my friend Constantinos from IHS Markit.
Turkcell moves further into pay TV with Premier League rights deal
September 09, 2016 |
Turkcell, the Turkish mobile telecoms operator, has acquired the exclusive media rights for the English Premier League in Turkey for the period 2016 to 2019. Turkcell – the largest mobile operator in Turkey – became the sole broadcaster for the rights following a sublicensing agreement with Saran Media Agency which acquired the rights in January.
Turkcell and Saran Media Agency did not release financial information on the agreement. Turkcell will offer matches via its Turkcell TV Plus IPTV and OTT (fixed and mobile) platforms. Having seen strong growth in its TV services, Turkcell is now expected to bid for the rights to the Süper Lig, Turkey’s domestic football league.
The acquisition of the Premier League rights steps up Turkcell’s involvement in the TV business in Turkey. It marks the first time that the Turkish telco has entered the sports rights market, let alone the premium sports rights market. Up to now, Turkcell TV Plus offered no premium entertainment or sports content. Turkcell TV Plus offers a total of six packages, including a Cinema TV pack and MUBI Film pack), but the telco does not control any first window rights for movies or foreign TV series.
According to IHS Markit Technology data, Turkcell had 34 million mobile customers at the end of 2015, representing a market share of 46.47%. In October 2014 it launched its TV offer, branded as Turkcell TV Plus. This move has paid off as it has managed to almost quadruple subscriber numbers from 60,000 in 2014 to 224,000 in 2015. At the end of 2015, around 150,000 of these were primary IPTV subscribers while another 74,000 IPTV customers also subscribe to another pay TV operator (mainly Digitürk). Its OTT service, called also Turkcell TV Plus, has been even more successful so far, having managed to attract 411,000 subscribers by Q1 2016. A precondition for access to the OTT service is to be a Turkcell Superonline subscriber (either ADSL or Fiber) or a Turkcell 4G subscriber. The OTT service is accessible in Turkey via Apple & Android smart-phones & tablets, PCs, Laptops and a range of connected TVs (Samsung, Grundig, LG, Beko, Vestel).
Turkcell’s strategy is to enrich its TV proposition further, and IHS Markit expects the telco to bid aggressively in the forthcoming tender for the media rights of the Süper Lig (Turkey’s football league). The current rights holder is Digitürk but its contract period expires at the end of the 2016-17 football season and a new tender is expected to be launched in the coming months. For Turkcell, football would be an ideal way of leveraging its €1.62 billion investment in acquiring 172 MHz of spectrum. Turkcell has already started rolling out a 4.5G LTE network across Turkey, providing mobile broadband with speeds of up to 375 Mbit/s, and has experimented with broadcasting sports content via its mobile network, delivering HD video streams of a basketball match over its LTE network in May this year.
Turkcell is following the steps of the other big telco in the country, Turk Telekom, which has exploited sports content as a strategic asset in order to boost its bundled service. Turk Telekom has managed to reverse a downward trend in its IPTV subscribers’ figures, from 308,000 in Q1 2014 to 282,000 in Q1 2015, by acquiring the rights for the UEFA Champions League and Europa League for the period 2015 to 2018. Turk Telekom’s IPTV subscribers at Q1 2016 stood at 351,000, a 25% rise year-on-year.
Reports in the Turkish media indicate that Turk Telekom is also expected to bid for acquiring the rights for Turkish football. However, both telcos will face tough competition from Digitürk, which has been acquired by the Qatari-based BeIn Media Group. The current value of the Süper Lig rights stands at €406 million per year.