Danish TV market. Anders Jensen SEVP TDC Consumer & Group CMO London, March 19 th, 2013

Transcription

1 Danish TV market Anders Jensen SEVP TDC Consumer & Group CMO London, March 19 th,

2 Background Growing channel proliferation, more expensive sports rights and differentiation through own produced local programs leads to high growth in content costs Flat Danish TV advertising market, leads broadcasters to move to full distributing, meaning little channel differentiation across distributors Content owners, broadcasters, distributors (including TDC/YS) and global on-line companies are behind several recent OTT launches, in the Danish market SE (utility with fiber base) acquisition of Stofa adds financial capacity to the current number two cable company increasing competitive pressure Customer and regulatory wishes, means YouSee will launch sale and distribution of individual channels in parallel with current package structure 2

3 TDC Group TV performance primarily driven by higher YouSee ARPU and growth in TDC Consumer RGU s YouSee TV revenue DKKm TDC Consumer TV revenue, DKKm 7.5% 2,600 2,832 3,034 3, % RGU s 1 ( 000s) CAGR 1,153 1,176 1,179 1, % RGU s 1 ( 000s) CAGR % ARPU (DKK) % ARPU (DKK) % Note: EoY 3

4 Pay TV growth primarily within DSL, fibre and DTT Pay TV subscribers by technology/brand, thousands 2, TV2 became Pay TV in Jan , , DTT 1 DTH 2 Fibre DSL Market share, 2012 Boxer 14% Viasat 6% Canal Digital 4% Utilities 4% TDC 3 7% Other DSL 1% 1,728 1,718 1,715 Coax YouSee 45% Stofa 14% Other coax 6% % of coax are organized customers 1) Digital Terrestrial Television, i.e. antenna TV 2) Direct To Home, i.e. satellite TV 3) TDC includes ~8k subscribers on fiber Source: YouSee 4

5 Key broadcasters in Denmark are DR, TV2, Viasat and SBS Broadcasters Parent/ ownership Owned by government State-owned company Channels Sweden Media license fee Sports Content focus Examples Own TV series, public service The Killing Borgen News, lifestyle programs e.g. News Go morgen DK Reality & 1 st tier sports rights, e.g. Paradise Hotel Champions L. Sports, reality US TV series, e.g Big Brother House Film and 2 nd tier sports rights, e.g. Europa League ATP Tennis Source: Lit. search, TNS Gallup TV-Meter 5

6 Viewing time has stagnated and top 10 channels now starting to loose viewing time as well as share Average viewing time for top TV channels, hours per day 3h16m 3h18m Viewing time share 1, 1-3Q2012 2h36m Other 4 eren 5 eren TV3+ TV3 DR 2 DR 1 TV2 Zulu TV2 News TV2 Charlie 10% 11% 28% 35% TV ) Viewing time share includes new and smaller channels within in other Source: TNS Gallup TV-Meter, Jan

7 Increasing cost of exclusive (sports) rights and own produced content has led to high growth in content cost Annual costs of TV rights for Champions League in Denmark, DKKm x6 210 Higher acquisition costs for exclusive sports rights More content required due to channel proliferation More unique own produced content needed to differentiate Note: DBU = Dansk Boldspil Union Source: DBU annual reports; Divisionsforeningen webpage 7

8 Higher content costs and a flat Danish TV-advertising market DKK, million 2,254 2,471 2,516 2,431 2,059 2,256 2,517 2, E 1) Based on growth 1H2011 to 1H2012 Source: Reklameforbrugsundersøgelsen, DO 8

9 has forced broadcasters to seek revenues through full distribution in 2013 New in 2013 DK distributors Cable (Coax) DTT (antenna) DTH (satellite) IPTV (xdsl & Fiber) Broadcasters 1 + OR 2 1) Viasat add-on package 2) Either SBS or Viasat, however in 2013 Viasat package include 4 eren and 5 eren Note: Changes in 2013 driven by a channel swap agreement between Viasat and SBS on TV3, TV3 Puls, 4 eren, 5 eren and sports channels Source: Lit. search 9

10 YouSee/TDC will compete through seamlessly integrated household solutions Unique selling points Voice and high speed data access at home and away on all devices Access to all content through a user friendly interface, anytime, anywhere, any device One-stop shopping, hassle free and with bundle benefits Differentiated service at call center and at home 10

11 and already have an advantage through true quad play offering and unique entertainment VAS s Cable (Coax) DTT (antenna) DTH (satellite) IPTV (xdsl & Fiber) Products TV Broadband Telephony Mobile VAS/USP: VoD Music (All) HD On-thego TV ( ) 1 ( ) 1 ( ) 2 1) Through cooperation with Telenor 2) As MVNO Source: Company websites 11

12 SE acquisition of Stofa has grown SE scale on TV (Waoo! could be next) and O-customers expect to be targeted Pay TV subscribers post-acquisition, thousand subscribers, 2012 Fiber Coax DSL 1,397 x3.5 1, Excl. SE 1 Of which 190k is in TDC Consumer, and 15K is in Business and Wholesale. Approx. 8k is on fiber Note: SE has no debt, and owns 3,5% of DONG Energy. 3,5% of shares on DONG Energy was divested for DKK 1.2bn in June 2012 Source: Lit. search; YouSee 12

13 Several initiatives to secure O-customer loyalty like recent YouSee Live 2013 event YouSee Live 2013 Event about future trends in broadband and TV 10k participated of which almost 4k were representatives from antenna- and housing organizations 13

14 Several new OTT offerings launched across value chain International OTT Broadcasters Distributors Strong on platform availability Access to DR programs within last week Available to all Own customers Mainly own content TV2 TV shows and movies on demand as well as sport Available to all TV3 TV shows on demand Own customers Own customers SBS TV shows on demand Own customers 14

15 but content rights is a challenge for all TVoD (4 months) Full catalogue Full catalogue Exclusive 1 st window SVoD (12-24 months) 3/6 majors (37%) 1/6 majors (18%) 2/6 majors (29%) 2H /3 local studios 1/3 local studios Pay-TV only 2 Danish only 3 Mini majors n.a Mini majors Co-exclusive 4 Mini majors Exclusive 2 nd window SVoD (24-30 months) 1/6 majors (10%) 3/6 majors (37%) 1) From 2H 2013, Netflix will have exclusive 1 st pay window to Warner Bros. Exclusive 2 nd Pay window is undecided, but currently with ViaSat 2) Nordisk film currently does not offer SVoD as part of exclusive Pay-TV window 3) Local SE/NO movies are exclusive to Viasat 4) HBO is co-exclusive - currently C-More only has access to the latest seasons, i.e. initial seasons are missing Source: Lit. search 15

16 YouSee to launch new TV channel concept in July 2013 to accommodate a changing TV landscape Purchase of individual TV channels available from YouSee from July 2013 More than 100 channels to choose from Available to YouSee TV subscribers with the basic TV package or higher Minimum requirement on number of channels purchased will be removed (currently min. 4) 16

17 TDC/YouSee initiatives launched to mitigate risks posed by recent changes to TV market 1 Increasing content cost Growing broadcaster content cost is pushed on to TDC/YS and end customers Diligent mngt of content costs through dialogue on new and existing channels 2 Little differentiation in channel offering Limited differentiation on channels available across distributors and technologies Differentiate TDC/YouSee offerings through VAS s and true quad-play solution 3 Distribution market Syd Energi (SE) acquired Stofa in October 2012 giving SE scale on TV offering Proactive in O-customer dialogue, leveraging current strong relationship 4 OTT Netflix & HBO entry in Denmark as well as broadcasters OTT solutions Launch of own SVoD services, including YouBio, and TDC Play Freedom of choice TV Regulatory authorities and customers push for more freedom of choice Launch of new channel concept with more freedom of choice 17