Multichoice Hellas is one of the leading pay-TV operators in Greece and the direct-to-home (DTH) operator is playing a key role in bringing new digital services to Greek customers through its digital satellite platform, Nova. The operator already had over 250,000 digital-TV subscribers and has already brought services such as personal video recorder (PVR) there. With Greece having a population of nearly 11 million, there remains plenty of room for growth for the Nova platform.

A major change in the company’s strategy could take place next year to boost its subscriber numbers. At the moment, the operator offers a one-size-fits-all package to customers, yet Multichoice Hellas’ commercial director, Kostas Vrionis admits it may not be long before the operator changes that. “The next big thing for us in terms of increasing the penetration is tiering,” he said, “and we are really looking into it. On the other hand, when you do have 325,000 subscribers (overall), it is risky. You don’t really know what will happen when you start to tier and bring out cheaper packages. Cheaper packages mean lower margins. If you have a lower average margin, you need more subscribers in order to break even. The question is if there are enough new subscribers out there to compensate for the loss of the margin; the research we have done says yes, but we are not sure.”

PVR And VoD

In terms of its PVR, it is in the early stages of launching services. Vrionis said “the service is 7.5 euros ($10) a month, which covers the dual-view function as well as the rest of the PVR capabilities, like recording, pause, rewind, etc. The retail price of the hardware is 399 euros ($531) for our subscribers, and 499 euros ($664) for new subscribers. For comparison, standard equipment retails at 149 euros ($198). Up to now, 80 percent of the PVR subscribers are coming from the existing digital base. Our forecast for the end of our fiscal year (March 31, 2007) is 25,000 PVR subscribers.”

With PVR equipment in customers’ homes, the next step is providing more advanced services, such as video on demand (VoD). Vrionis said “we are planning to launch push-VoD services [and] are also thinking about SVoD, as well as some free VoD services. Since we are still investigating the technical infrastructure as well as the commercial proposition, I don’t see it happening before March.”

Regardless, it may yet take time for high-definition television (HDTV) to take hold, Vrionis said. “HDTV has started to become a big subject in Europe, but not yet in Greece. The market is quite small (3.5 million households), and pay-TV penetration is around 10 percent. Also, the investment for HDTV is quite big. It requires a huge amount of bandwidth and it is not going to pay off for us. It is a straightforward financial exercise. Also, the big [free-to-air] commercial channels are not in position to invest in HD. So to conclude, I don’t think Greece will move into the HD era at least for another two years.”

Other Platforms

Like other satellite pay-TV operators in Europe, the operator is looking to bring its content offerings to customers on different platforms. In terms of IPTV, Vrionis said it intends to work alongside major telco OTE for IPTV. “We have an initial agreement with OTE for triple-play services. A pilot trial will start before March 2007 so as to better understand the technical details and the usage patterns and preferences of consumers. The target for commercial launch is set around the second half of 2007.”

Multichoice Hellas also hopes to boost its mobile presence. “The service with TIM is already launched,” Vrionis noted. “A subscriber of TIM can watch our product on mobile [and] we are in negotiations with both Vodafone and Cosmote. Our goal is to have the same product for everybody.”

One of the major potential competitive threats for the company is the emergence of digital terrestrial TV (DTT) as a viable alternative platform. Launched in April, Vrionis said there are already 80,000 DTT set-top-boxes in the market; he hopes his company plays a role in developing the market. “This may present a threat to us,” he said. “After all, it is free [and] the cost of the box is not that high in Greece. You can acquire a decoder for as little as 39 euros ($52). On top of that, the majority of the new flat TVs have DTT decoders embedded into them. Up to now, even if it’s early, we haven’t seen any churn from our subs due to DTT. However, if the programming line-up strengthens, if they invest in documentaries for DTT, and sports, things could change. ERT (a major broadcaster) is already investing in Greek sports. If they continue, and some of these sports – and especially soccer – are given to DTT, it will have an impact for us.”

He added “our intention is that when the whole framework of DTT in Greece crystalizes, we definitely want to have a DTT pay-TV service, though I don’t think we will be able to do that for the next two years.”

–Mark Holmes Contact, Harry Botsaris, Multichoice Hellas, e-mail, [email protected]