A fast growing number of Europeans are opting for Digital Terrestrial Television (DTT) to replace soon to be axed analogue services, a new study reveals.
But analyst firm ABI Research said that the future for DTT across Western European countries "varies wildly".
Most DTT services are free-to-air with no subscription and minimal hardware requirements. In the UK, for example, DTT set-top boxes are available for as little as £10.
However, pay-DTT in particular is carving out a niche in competition with other pay-TV offerings from cable and telco-based providers in some markets, according to the analyst firm.
A new ABI Research brief noted that DTT's market potential "varies widely from country to country" depending on factors including the availability of digital alternatives and the current reliance on analogue terrestrial free-to-air TV.
"Some pay-DTT providers are positioning their service as a kind of 'halfway house' between free-to-air services and other forms of pay TV," said senior ABI analyst Cesar Bachelet.
"They offer all the regular free-to-air programmes, plus some premium content at an attractive price.
"One of the most interesting markets, Italy, is expected to show the strongest growth in DTT over the next five years, and pay-DTT is a leading component of that growth."
Bachelet explained that pay-DTT is attractive for several reasons, including plenty of sports programming, but the main driver is the prevalence of pay-as-you-go services that do not require a commitment to lengthy subscriptions.
"The pay-as-you-go model has a strong history in Italy in broadband and mobile telephone services, so the transition to pay-DTT is an easy one," the analyst said.
"ABI Research believes that pay-as-you-go DTT will prove popular in other European markets as well."
Another important determinant of DTT's success in a given market is the a vailability (or lack) of digital alternatives, and the level to which the population depends on analogue terrestrial free-to-air television.
In Belgium, for example, where most of the population gets its TV via cable, the migration to digital TV will primarily occur within the cable environment. So DTT is unlikely to gain much traction.
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