Industry Analysis & Industry Trends
The Pay Television industry has performed strongly over the past five years due to increasing pay-TV penetration and greater subscription numbers. Industry revenue is expected to increase at a compound annual rate of 4.3% over the five years through 2014-15. Rising real household discretionary income has assisted financial performance over the past five years, as consumers have had more money to spend on non-essential services such as pay-TV subscriptions. This trend has also limited the number of cancelled subscriptions, further assisting industry operators. In addition, viewers have watched free-to-air TV networks less, demanding pay-TV subscriptions to receive a greater range of TV programs, films, sports telecasts and news programs... purchase to read more
Industry Report - Industry Investment Chapter
The industry displays a high level of capital intensity. In 2014-15, for every dollar spent as wages, an estimated $1.48 is invested in capital. Capital intensity is high for industry operators due to the significant investment required in telecommunications infrastructure and the high levels of program amortisation. Establishing satellites and laying fibre-optic cables to transmit pay-TV channels is extremely costly. The industry also incurs significant up-front capital, maintenance and depreciation costs to establish and maintain TV studios.
Programming costs and associated amortisation are also significant, as these intangible assets are required to be written off as their value decreases over time... purchase to read more