FSS Operators Eye Revenue Growth
But HD will take hold in Europe, and operators see a key revenue generating opportunity going forward. "Our belief is that in around the period 2009, there will be around 130 HD channels in Europe," says Giuliano Berretta, Eutelsat's CEO. "These are figures by Euroconsult. We subscribe to these and even think these might be on the conservative side. That is our benchmark. We believe around one-third of those will be broadcasting through Eutelsat capacity. That is between 10 and 15 transponders. We think the mass market for HD is going to be in the 2010-2011 time frame."
In 2005, more than one-third of Intelsat's content delivery revenue came from HD broadcasts, McGlade says. The chance for further growth is obvious as HD content becomes more widespread, but satellite operators will need to improve the use of their own transponder space using improved compression technologies, as well as work in concert with other delivery systems, to meet the HD demand efficiently. Major telcos sitting on large amounts of spare fiber-optic capacity will have an economic advantage over satellite operators in large cities, but "in areas where there is low fiber density, satellite is better for delivery," he says.
Alexander Oudendijk, chief commercial officer for SES Astra, also believes the HD market is showing "significant momentum" in Europe, with more than 3 million HD sets already sold. "We expect more HDTV channels, more HD transmissions over satellite and a larger availability of receivers," he says. "As a distribution way, the satellite is poised to benefit specifically from the development of HDTV as it is - with practically no restrictions on bandwidth - by far the best transmission way for HDTV. We therefore expect that by the end of the year, Astra would carry around 20 HD channels. The number of households with HD ready screens in Europe is expected by experts to increase above 10 million somewhere in 2007."
However, there are obstacles for the take-up of HD in Europe. Oudendijk added, "The main hurdle is clearly the availability of receivers and, to some extent, also of relevant HD content. In general, a choice of more than three to four HD channels should be available in order to become interesting for viewers. As soon as more public and private broadcasters switch to HD, the take-up will accelerate.
Asia will provide an even more unique challenge for HD providers. Some countries, such as Japan, are advanced users of HD and moving to services beyond that such as super HD, officials says. The take-up of HD in other areas will be harder to predict, as there is no demand for a pan-Asian channel, DiMauro says. "Every channel is particular to a region," he says. "It could be the same programming, but you could have to supply 15 different languages. We want to be a global player. We have connectivity from London to Northern Africa to Eastern Europe, and we're reviewing where there are the most growth opportunities."
Mark Holmes is International Editor for Satellite News. Jason Bates, Assistant Editor of Via Satellite magazine, also contributed to this story.
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