Summary:

The pay-TV market is nearing a subscriptions plateau – but YouView doesn’t yet look like stealing current operators’ customers.

An Oliver &…

YouView logo, chairman Kip Meek, CEO Richard Halton
photo: YouView

The pay-TV market is nearing a subscriptions plateau – but YouView doesn’t yet look like stealing current operators’ customers.

An Oliver & Ohlbaum survey of internet users found only eight percent are likely to subscribe to pay-TV services next year…

What’s more, free-to-access YouView, due for 2011 launch, appears to pose some threat to pay-TV operators like Virgin Media (NSDQ: VMED) and Sky. Four percent of current Freeview homes plan to get YouView instead of pay-TV, and a total 18 percent of current pay-TV homes said they will likely switch away from their provider to YouView instead, according to O&O…

But O&O CEO Mark Oliver said this is actually small. “There isn’t much evidence so far that pay-TV subscribers or people intending to get pay-TV are really thinking again about pay-TV because YouView is coming along.”

Still, BSkyB (NYSE: BSY) stands to lose five percent of its customers to YouView, up to 84 percent of whom are higher-tier Sky subscribers, Oliver said. Sky itself has forecast it will lose four percent. Research for the BBC Trust agreed Sky’s subscriber growth could slow by up to four percent.

“Pay TV still faces a 60 percent penetration barrier in the UK. Some of the fears of Virgin Media and Sky may not be realised – but then, YouView has not yet been marketed, so we’ll see next year.”

Oliver said survey respondents had been informed the kinds of services YouView will offer.

The BBC conceived YouView to give free-TV homes access to TV-VOD and TV-internet services without the necessity for a subscription. Sky and Virgin have lobbied vigorously.

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