Fundamental changes are currently taking place in Russia’s TV industry.
The two most important ones are arguably in the pay-TV and OTT/online video sectors. As can be seen from data published on a regular basis by such companies as Telecom Daily and J’son & Partners, subscriber growth in the former sector has slowed considerably. Indeed, according to Telecom Daily the number of new pay-TV subscribers in the third quarter (95,000) was only half that (190,000) in the second.
Moreover, with pay-TV penetration now around the 75% mark and ARPU showing few signs of growth, the market still continues to be dominated by five providers – Tricolor TV, Rostelecom, ER Telecom, MTS and Orion – and only one (Rostelecom) is significantly increasing its pay-TV subscriber base.
It is therefore perhaps not surprising that providers are changing their strategy, widening offers as they develop into multiplatform operators. The delivery of additional services, ranging from catch-up and OTT to Ultra HD channels, is now seen as a necessity.
The second most important change is in the legal online video market. Specifically, there is a gradual shift in the business models being used by providers from ad-funded to all types of subscription. This underlines the fact that an increasing number of Russian viewers are willing to pay for content and is reflected in significant growth in the value of the legal online video market. J’son & Partners has put its value at R10.27 billion (€137.2 million) in the first half of this year, an impressive 48% more than in the corresponding period in 2017.
This growth has been made possible by cooperation between providers of online video services and the operators of linear TV channels, with the latter becoming an increasingly important part of online offers.
There is also cooperation in the fight against piracy. Just this week it has been reported that a number of stakeholders, ranging from Channel One, National Media Group, Gazprom Media and the Internet Video Association, whose members include the OTT services Ivi and Megogo, along with a number of ISPs, have signed an anti-piracy memorandum aimed at removing links to websites displaying unlicensed content.