W. European Pay-TV Revenues To Exceed Adspend In 2004, Says Report

Advertising expenditure stood at $22.0 billion in 2003 and is expected to grow to $22.6 billion this year; by 2012 revenues should hit $29.5 billion, says the Television In Western Europe To 2012 report. Television advertising is expected to remain nearly static as a percentage of the European economy over the forecast period, representing 0.24% now and rising to just 0.27% by 2012.

Pay-TV revenues to exceed advertising Revenues generated from pay-TV will continue to rise at a faster rate than TV advertising, up by 58% to $33.8 billion in real terms by 2012. Significantly, pay-TV revenues will surpass those derived from advertising by as early as the end of this year and continue to grow at a slightly higher rate than advertising between now and 2012.

The report says that basic subscription packages account for 58% of total pay-TV revenue; this is expected to fall only slightly to 55% by 2012 due to the prevalence primitive continental cable systems.

Pan-European average revenues per user (APRU) currently average $24 per month (about £13), with satellite homes typically spending more than cable homes. However, contrary this trend, in the UK BSkyB’s ARPU is currently around £31, whilst Telewest’s is over £44 (see Telewest Turns The Corner As Loss Declines).

Western European Television Revenue Forecasts (US$m, 2002 Prices)
	Advertising expenditure	Subscription revenue
1991	14,237	4,789
1992	15,025	5,993
1993	15,423	7,105
1994	16,744	8,296
1995	17,763	9,331
1996	18,012	10,958
1997	19,229	12,327
1998	20,664	13,392
1999	22,379	15,016
2000	24,086	16,394
2001	22,240	18,699
2002	22,058	20,019
2003	22,034	21,384
2004	22,559	22,852
2005	23,144	24,620
2006	23,815	26,338
2007	24,793	27,678
2008	25,788	29,034
2009	26,909	30,184
2010	27,794	31,299
2011	28,680	32,213
2012	29,462	33,772
Source: ZenithOptimedia, March 2004