More than 300 UHD channels will be delivered by satellite providers to pay-TV provider headends around the world by 2020, according to Jorge Rodriguez, marketing manager at Hispasat. In a presentation at Hispasat Innovation Days reported in BroadbandTV News, Rodriguez said that device shipments, including UHD TVs and UHD-capable connected devices (such as Roku boxes) were driving the market today, with shipments ramping up rapidly.
Hispasat is one of the world's largest providers of satellite communications services; it operates a fleet of satellites that deliver a range of telecom services including telephony and video conferencing. Hispasat also delivers well over a thousand TV channels and radio stations, typically to pay-TV provider headends, so they can then deliver them to consumers.
Presenting at IBC last year, fellow satellite delivery provider SES S.A. (Paris: SESG) estimated that 39 UHD channels were being distributed at year-end 2015, with 786 expected at year-end 2024. Interestingly, SES anticipated the majority of these channels would be broadcast in developing countries.
An explanation for this seeming anomaly can be found in comments from Wesley Hicks, senior product manager at EXFO (Nasdaq: EXFO; Toronto: EXF) While discussing UHD video on a panel at Light Reading's BCE event last month, he said he was seeing more UHD deployments in Asia, where entirely new, greenfield networks were being deployed. As a result, they tended to be fiber-to-the-home (FTTH) deployments, with more capacity than older networks in more developed parts of the world. This made it easier to deploy "fat video" services like UHD. (See Making Fat Video Fit.)
Rodriguez said that the next two years would be critical for the technology, and pay-TV providers needed to get behind it to make it a success. But providers who embrace UHD will benefit, as his research showed that consumers were willing to pay a premium for UHD content.
He quoted research that found just under seven in ten people in the Americas (69%) would pay "a little extra" for UHD services. "A little extra" was defined as a premium of 10-30%. Respondents from EMEA and APAC were not far behind, with 67% willing to pay extra in EMEA and 63% in APAC.
The willingness to pay a premium does have a low ceiling though, with just 10% in the Americas, 16% in EMEA and 13% in APAC willing to pay more than a 30% premium for UHD services.
In terms of content genres, live sports were the main driver for UHD production and broadcast, as in the case of BT Sports and others. Rodriguez felt that early-release movies and some VoD would be next. (See How BT Learned to Love 4K.)
Today, pay-TV providers were primarily concerned with the availability of UHD content, with 29% citing it as a concern. Workflow and network complexity were also issues, with 25% worried about the number of variants required: SD, HD, UHD and also combining High Dynamic Range (HDR) with each format.
One of the key issues with pushing UHD is for the industry to gain more consensus on HDR, where different approaches have slowed deployment. But it does seem that at least the HDR-10 approach, now approved by the ITU, is helping operators move forward. (See UHD Forum's Fautier Clarifies UHD Growth Path and ITU Unveils New HDR Standard for TV.)
The problem is that more recent innovations, such as a more advanced HDR approach, coupled with interest in higher frame rates and wide color gamut technologies complicate technology selection somewhat. Add that to bandwidth constraints, an unclear business case and a shortage of available UHD content, and you can see why operators are proceeding cautiously.
— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation