Recent data from Omdia reveals that approximately 25% of all paid SVOD subscriptions in Central and Eastern Europe (CEE) now originate from pay TV and telco bundles. This shift highlights the growing importance of strategic partnerships in the region's streaming landscape. According to Omdia's research, indirect net additions, those through partnerships rather than direct-to-consumer channels, will dominate SVOD net additions in the CEE region from now until 2028. By that time, indirect subscribers through partnerships are projected to constitute 29% of the total SVOD subscription base.
Omdia's analysis includes data from Russia, where some SVOD services were withdrawn following the invasion of Ukraine in 2022. This period saw a peak in subscriber additions during the COVID-19 pandemic, followed by some market volatility and subscriber churn. Noteworthy partnership deals implemented in 2022, such as HBO Max with Vodafone Hungary, Viaplay with Canal+ Polska, and Disney+ with Netia, have significantly influenced the market dynamics. The increasing significance of bundling in the CEE region makes indirect subscriptions more prominent relative to the total than in North America, although still trailing behind Latin America, where bundling is crucial for SVOD.
Eastern Europe will have 68 million SVOD subscriptions by 2029, up by 27 million on 2023, according to Digital TV Research’s latest report, which also notes that Russia will generate 12 million of the additional subscriptions, with Poland bringing in an extra 6 million. Digital TV highlights that the top platform by subscribers for the region will not be US-based, as it will be Kinopoisk, which is only available in Russia. Moreover, according to the report, Russia will account for 53% of the 2029 total SVOD subscriptions.
Still in the digital side of the video business, the CEE market is on track to reach US$ 42 million in FAST revenues by 2028, according to new research from Omdia. The CEE region joins a buoyant market currently dominated by the United States, with rapid expansion from the UK, Canada, and Australia expected over the next four years. Regarding players, Rakuten and Plex are the only FAST platforms available in CEE. A few local providers exist, such as Kabaret TV in Poland, but overall, the FAST market is nascent in the Central and Eastern European region. Due to CEE’s market size, the international FAST channel operators have not launched their channels in the region. ITV Studios cited cost of dubbing as the reason for not yet launching FAST in Italy or Spain, meaning CEE markets with multiple languages will lag even further behind.
LINEAR REACH
The linear TV business still has a predominant role in the CEE region, as an essential component of the media distribution mix, generating more revenue for most content owners than ad-funded streaming, a key pillar of content brands alongside co-branded FAST channels and streaming services. According from data from Intelsat, these market dynamics are seen mainly in Central and Eastern Europe, where expanding economies and a still-growing number of TV households create opportunities for channel owners to reach new audiences and tap additional revenues. As pay TV operators and telcos in CEE shift to a super-aggregation model, offering popular linear TV channels is a crucial point of differentiation as they compete with standalone streaming competitors and smart TV devices. Channel owners have multiple technology choices for delivering their channels to operators, with satellite maximizing reach across pay TV platforms, fiber enabling robust delivery of localized channel versions, and internet feeds enabling rapid coverage of hard-to-reach operators. Telcos and pay-TV operators have varying preferences for which delivery mechanism they prefer to use to receive channel feeds, with trade-offs between upfront cost, signal quality, operational complexity, security, and time-to-market.
Channel owners can maximize the number of TV households they reach by adopting a hybrid distribution strategy, using each distribution mode flexibly to respond to the needs of each market and every individual satellite DTH, cable, and IPTV operator. This is enabled most efficiently and effectively by working with a distribution service provider that can support satellite, fiber, and internet models and demonstrate experience working with pay TV affiliates in multiple markets.
Within the CEE region, there are 30 million pay-TV households receiving satellite DTH, cable, and IPTV services across the seven key markets (Bulgaria, Czech Republic, Hungary, Moldova, Poland, Romania, and Slovakia). The region has some of the highest average pay TV penetration in the world, according to data from Ampere Analysis. These are fast-growing economies, with per-capita GDP seeing a compound annual growth rate of 7% and 9% in most markets from 2017 to 2022, compared with less than 2% in many mature Western European countries. Further, six million pay TV customers can be found in Albania, Bosnia, Croatia, Montenegro, North Macedonia, Serbia, and Slovenia.
This combination of TV household growth and economic expansion provides a vast potential market for channel owners to reach a growing consumer base. This is attractive to advertisers, and households are increasingly willing to pay for premium content through TV channels and video-on-demand. And while the number of pay TV households in Western Europe remains static, CEE markets have seen 1.9% compound annual growth in the number of homes receiving pay TV services between 2017 and 2022. By 2027, this is forecast by Ampere Analysis to grow a further 0.6%, reaching 30.8 million pay-TV households, with millions more receiving OTT TV services. Within the CEE region, multiple telecoms and pay TV operators offer services across satellite, cable, IPTV, and OTT. The market is a vibrant mix of independently owned operators and those that are part of European and expanding regional groups, including A1 Group, Canal+, Deutsche Telekom, Orange, Telekom Srbija, United Group, and Vodafone.
The number of digital pay TV subscribers in the CEE are expected to rise by 9 million by 2029, according to a research by Digital TV Research. However, the number of pay TV subscribers will decline by 8 million from 81 million in the peak year of 2018 to 74 million in 2029. However, 2018 included 17 million analog cable subscribers, which will drop to zero by 2027. Pay TV subscriber numbers will fall in 20 of the 22 countries analyzed by Digital TV Research from 2023 to 2029, with the total down by 2.4 million. There will be 4.6 million fewer analog cable subs. Pay satellite TV will fall by 2.6 million. However, IPTV will gain 2.8 million and digital cable 1.9 million. Russia will account for nearly half of the region’s pay TV subscribers in 2029, despite losing 2.6 million pay TV subscribers between 2023 and 2029.
By Diego Alfagemez