As the cost of Digital Video Recorders (DVRs) continues to fall, DVRs are now becoming a “must have” item in many homes. DVR technology enables viewers to record live TV, play back, pause and rewind live broadcasts and store many hours of programming. A recent global research study showed that the owners of DVRs overwhelmingly agreed that their enjoyment of watching TV was significantly enhanced by having a DVR and that it was the second most important household item, after the mobile phone.
In the UK and Ireland, the bundled Sky+ DVR service is now in over 5 million homes, which means that it is in every second Sky home! In Australia, 2 out of 3 set top boxes (STBs) deployed are DVR enabled and in the US, most operators now provide DVRs as a standard feature. The largest operators around the world admit that the DVR and HD services are the main factors for increased ARPU and subscriber churn reduction even during the recession.
It is expected that Asia will also witness a rapid growth rate in DVR ownership. India is projected to have the second highest level of DVR subscribers in Asia by 2013, and will overtake Japan to have the highest number of DVR subscribers by 2018.
DVR Subscribers (000)
2009 2013 2018
India 99 1,554 4,085
China 154 1,488 4,045
Japan 644 1,606 2,326
Korea 57 353 1,067
DVR revenues in Asia Pacific will also show impressive rates of growth, led by Japan. Other major Asian markets that will witness large increases in DVRs revenues include China, Korea and India. It is projected that India will generate US$68 million in DVR revenues by 2018.
Many operators, such as BSKYB in the UK and Foxtel in Australia are using DVRs to drive subscription to their top tier packages. Operators are also using aggressive pricing options with free DVR upgrades and bundling various monthly subscription packages to attract new customers. Operators have seen that the DVR helps to increase the average revenue per user, as the adoption rate has been high among the subscribers opting for higher-end packages.
Operators are also using DVRs to reduce churn and increase customer loyalty. The use of DVRs has generated positive feedback in customer satisfaction surveys conducted by operators, with 8 out of 10 Sky+ users in the UK stating that they have recommended this service to a friend and that the Sky+ service has improved the quality of the programmes they watched.
In India, Tata Sky and Hathway use the world-leading NDS' XTV™ DVR technology, which has been deployed in more than 19 million devices. NDS is the world leader in deploying advanced DVR services
Tata Sky was the first Indian DTH operator to make NDS' XTV™ DVR technology available in India. Tata Sky + allows its viewers the flexibility to record one programme while watching another, pause a live telecast and even rewind a TV programme they are watching.
The NDS XTV™ DVR solution brings several advantages to the operators' businesses:
• Platforms can offer all DVR functions, such as simultaneous recording and multiple episodes recording, through their own branded Electronic Programme Guide (EPG). This maintains a consistent look and feel on all STBs, which reduces customer support costs, and creates a faster learning curve for users
• Compensates for schedule overruns - as NDS XTV™ uses an operator's programme stream information to ensure that all programmes are recorded at the right time, even if schedules change due to programme overruns
• NDS XTV™ DVR solution provides not only title recording but also manual recording capability
• Fully integrates with an operator's headend and other pay-TV services such as conditional access and digital rights management (DRM), EPG and interactive services
• Gives the best protection for stored content with broadcast-strength encryption to create more revenue generating opportunities based on NDS' market leading conditional access system (VideoGuard)
• Has proven High Definition (HD) deployments so operators' platforms can move up to the next generation of TV viewing
• Provides a long-term roadmap, based on the DVR as the centre of the home entertainment system with multi-room DVRs, advanced media features and video on demand (VOD) services for the customers
• Offers more advanced features and applications that differentiate operators' service and keep customers more satisfied
• Increased adoption of HD programming is a significant driver for the DVR market. Service operators find it profitable to link subscribers upgrading to HD with HD-DVRs, and are marketing it aggressively. The NDS XTV™ solution is increasingly seen as a lifestyle product which enhances the home entertainment experience. It also allows multi-networking (enabling viewers to access content on the DVR from different rooms in the home) and remote scheduling (the ability to schedule DVR recording from a cell phone or a web browser).
• India is known for its fast adoption of new technologies and in this tech-savvy market we expect that within a short period of time, the DVR will be considered as essential as the mobile phone as is happening in other leading markets in the world.