Deloitte claims pay-TV demise talk in streaming era may be premature
Pay-TV providers' resilience in the face of the growing clout of video streaming services may have been underestimated, according to new research from Deloitte.
The consulting firm believes that the impact of services such as Netflix and Amazon Prime has been "greatly exaggerated" and pose far less of a threat to traditional broadcasters such as Sky than had been expected.
This is based on figures compiled by the firm which show that online video subscriptions cornered just 3 per cent of the £168bn pay-TV market with revenues of around £5bn.
Instead of an existential threat Paul Lee, director of technology, media & telecommunications at Deloitte, believes that such services can be complimentary, serving as a replacement for TV box sets. He said: “The rise of Netflix doesn’t mean the demise of pay-TV”, adding that the number of pay-TV homes has "barely shifted" in the US.
Despite recent growth at Netflix to 40m subscribers worldwide Deloitte believes its Achilles heel is the expense of producing desirable high-end content, more readily met by the deep pockets of commercial broadcasters.