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Global Pay-TV Subscribers will Reach 1 Billion by 2018

The digital video entertainment industry has seen mixed results this year, as pay-TV service providers find little growth in saturated markets. Regardless, the worldwide pay-TV subscriber base surpassed 886.5 million at the end of 3Q 2013 -- that's a 6 percent YoY increase, generating $62.6 billion service revenue in the third quarter.

"Emerging markets are key drivers of global growth in pay-TV subscribers as developed markets are experiencing flat growth rates,' said Jake Saunders, VP and practice director at ABI Research.

The pay-TV subscriber base in Western Europe grew less than 2 percent in 3Q 2013 from 3Q 2012. Notably, the number of subscribers in Spain and Italy has been declining for a number of consecutive quarters.

Respectively, pay-TV service providers in Spain and Italy lost over 7 percent and 2 percent of their total subscriber base compared to a year ago.

Pay-TV operators blame the weak economic environment for declining subscriber counts, but it is not all doom and gloom in Europe as other markets, such as France, Germany and UK, contributed to regional market growth.

Net additions in IPTV subscribers are the prime driver of pay-TV regional growth -- other pay-TV platforms saw only marginal increases.

ABI Research estimates the IPTV subscriber base in Western Europe increased 1.9 million in 3Q 2013 from 3Q 2012.

In North America, pay-TV subscribers dropped slightly (1%) from 3Q 2012, mainly due to contracting subscriber counts in the cable TV sector.

It is estimated that cable TV operators in North America lost around 1.7 million subscribers in the last year. In terms of pay-TV service revenue, North America grew nearly 3 percent from 3Q 2012.

Despite the declining subscriber base, pay-TV service revenue in North America grew due to increased average revenue per user which is driven by an increasing proportion of HD and advanced DVR subscribers.

ABI Research forecasts the global pay-TV subscriber base will eclipse 1 billion by 2018, generating service revenue of $229.6 billion. BRIC countries will account for 68 percent of total net additional subscribers by 2018.

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