In its latest Viewpoint “Major Transformation in CEE TV Markets: Shake Up Likely to Continue”, global management consultancy Arthur D. Little assesses the recent dramatic growth and TV platform shift in the Central and Eastern Europe (CEE) region and its likely impact on market players. Strong growth, as well as the major shifts in TV platforms – such as IPTV (Internet Protocol TV), DTT (Digital Terrestrial TV) and OTT (Over-the-top TV) – has created a competitive and dynamic market environment. Television markets in CEE are growing rapidly in terms of Pay TV subscribers, revenue and viewing; the number of households with more than one television grew by almost 50% and the share of households with Pay TV increased to 40% between 2008 and 2010. The CEE markets have also seen a radical shift in terms of TV platforms. DTH (Direct-to-Home) has dominated this transformation, its overall market share expected to surpass that of cable by the end of 2011. “While we expect traditional linear TV platforms to remain the dominant method for watching TV, the launch of new technologies, such as IPTV, DTT and OTT has revolutionized TV markets in CEE,” comments Karim Taga, Director at Arthur D. Little’s Telecoms, Information, Media & Electronics (TIME) Practice. While these technologies each have their limitations, their presence in these markets has facilitated the launch of hybrid solutions that promise to change the competitive environment. Hybrid solutions, such as DTT-OTT, DTH-OTT or IPTV-OTT, enable viewers to consume basic linear channels over DTT or DTH, enhanced by on-demand content via OTT. Driven by intensifying competition, consolidation in the telecoms and TV sector is still ongoing in the CEE region. For most players, the main rationale is to strengthen their market position or support convergent offerings. Market consolidation is leading towards a push in quad-play offerings, putting pressure on mobile-only or fixed-only players. In addition, ongoing platform competition and the rapid transformation of TV markets in CEE show no signs of slowing down. “Whether with OTT or DTT, future winners in these markets will need to engage in quad-play,” concludes Mr Taga. To access the full report, please visit:

www.adl.com/CEE_TV_Markets