Staying local in CEE

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By Ed Waller 09-07-2012

This year will be an important one for digital television in Central and Eastern Europe (CEE), according to a recent report from Digital TV Research. The number of digital homes in the 15 main CEE countries will exceed the analogue total for the first time.

In 2011, the digital TV total for the region stood at 48.5 million, compared with 65.1 million for analogue. This is due to shift to 60.3 million digital and 53.9 million analogue this year, as digital DTH, cable, DTT and IPTV penetration rises. Fast-forward to 2017 and digital homes in CEE will jump to 112.2 million while analogue will fall to just a few million, out of a total of 116.6 million TV homes.

Though it sounds odd, the recession appears to have played into the hands of pay-TV operators as it delayed the arrival of free DTT services that have eaten into pay revenues in many other countries. Poland and Romania are prime examples of this. Digital TV Research estimates that pay-TV will be taken by 61% of the region’s TV homes in 2017, up from 47% at end-2011 – or up by 18 million to 71 million. Pay-TV revenues in CEE will be 35% higher in 2017 (US$7.8bn) than in 2012 (US$5.8bn).

As well as the improving economies, one of the main drivers of this is local programming. Talk to buyers from the region and they’ll all say acquisitions in general, and US series in particular, are playing a much less important role. Such shows aren’t delivering the numbers anymore and have been demoted to smaller sibling channels.

It could just be a case of talking down the prices of the shows that were unveiled at the LA Screenings in May, but such comments are echoed in other regions. CEE is a textbook case of how many markets are transitioning from massive importers of content to producers of their own, initially via imported formats but now through their own development.

Take this to the next logical step, as many newly created sales arms of CEE broadcasters are already doing, and we have a new generation of distributors, laden with content that’s far more locally relevant than anything from Hollywood.

CEE’s move to local production is well underway; it’s the shift to regional distribution of that content that’s really changing business models for international distributors.