Despite increasing competition from over-the-top players and from satellite providers, and declining subscriber numbers, the cable industry in the European Union has continued to grow with gross cable revenues topping €22.4 billion ($23.34 billion) in 2015, a 5.7% increase year-over-year.
More than half of cable revenues in 2015 (53%) came from Internet and phone services, according to a report from IHS Markit, with Internet revenues up nearly 10% to €7.2 billion.
Overall, Germany (€4.7 billion, $4.9 billion) generated the largest revenues from cable operations, followed by the United Kingdom (€4 billion, $4.17 billion). The U.K. saw the highest revenue from Internet operations, €1.5 billion, followed by Germany (€1.1 billion) and Spain (€0.8billion).
The EU saw a slight decrease in cable subscribers to 55.1 million in 2015, from 55.7 million at the end of 2014. More than half (54%) of EU cable homes have
HDTV, although 4K/UHD remains in a nascent state. Only a few operators, including Portugal’s NOS, added UHD channels to their line-ups.
As in the United States, European operators are pushing ahead with infrastructure improvements aimed at delivering more bandwidth and higher speeds to customers increasingly looking to the Internet for their entertainment services, as well as facilitating the offering of VR and 4K/UHD services that operators hope will reduce churn among customers.
“Perhaps the most ambitious was Project Lightning, a huge broadband expansion program undertaken by Virgin Media in the U.K.,” said the report’s author, Maria Rua Aguete, research director at IHS Technology. The initiative hopes to connect an additional four million U.K. homes and businesses, extending Virgin Media’s cable homes passed to 17 million by 2019 from its current 13 million.
“Our research concluded that the integration of Netflix into pay TV is having a positive impact on cable operators’ key performance indicators, generally benefitting their business while co-existing well with more traditional parts of the bundle,” Rua Aguete said.