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Digital Pay-TV Market Opportunities Evolve in Australia

Television services are evolving in Australia, according to the latest market study by BuddeComm. Under the name Freeview, the free-to-air television operators have delivered new digital channels in 2010/11 in both SD and HD formats.

Viewer numbers are increasing and will continue to increase as the analogue transmission is switched off across Australia. Digital transmission first commenced back in 2001 and in 2011 celebrates ten years of operations with more Australians now enjoying the extra features and channels that are available.

Their success is putting pressure on the traditional pay-TV industry.

The analogue switch-off that commenced in 2010 is progressing throughout Australia with the final signals to be turned off by end-2013. The formation of Freeview along with the expansion of the network's online and cross platform offerings are providing enriched viewing experience.

By early 2011 total digital TV penetration had reached 75 percent across Australia and the remainder will have to switch over by 2013. A number of regions have now switched from analogue to digital broadcast TV, and of these regions most reach 100 percent household penetration leading up to the changeover.

Meanwhile the pay-TV service providers are making a concerted effort to maintain and grow subscribers, revenues and profits. The average revenue per user of both Austar and Foxtel has increased as they are driven by higher tier package adoption.

Pay-TV ARPU has continued to increase over the last couple of years. Even further growth may be experienced in 2011 as Optus is set to resell the Foxtel HD services to its own customers and may even get more customers buying the pay-TV services through its satellite services.

There are more than 100 English-language television services or channels currently available to subscribers from the three major local subscription television operators.

The operators also provide a selection of time-shifting, HD and digital channels. By 2011 the local Australian pay-TV providers -- Foxtel, Optus TV and Austar -- have between them more than 2 million household subscribers.

By early 2011, Australian pay-TV market penetration had reached about 32-34 percent across the nation. This is still well below penetration rates for similar services in other parts of the world.

IPTV services may take off when the National Broadband Network (NBN) rolls out fiber across the continent. Other offerings launched in 2010 include Telstra with its T-Box and FetchTV offering IPTV through ISPs including Adam Internet, iiNet and internode.

While the future of IPTV looks bright, in particular over high-speed broadband networks such as the NBN, the current IPTV offerings are severely hampered by the incompatible standards of the set-top boxes used by the above mentioned operators.

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