[Satellite News 10-12-09] Digiturk intends to launch a push video-on-demand service in Turkey before the end of the year, Berkman ÇavuÅŸoÄŸlu, vice president, sales, Digiturk, told Satellite News.

            “We have just launched subscription video on demand, and will be launching push video on demand by the end of this year. We have just introduced remote recording, and series-link recording function will be introduced in the coming months,” he said. Digiturk has about 2.3 million subscribers in Turkey. It’s video-on-demand service will be launched via its HD personal video recorder, DigiturkPlus, which was introduced in January 2008.

            Digiturk also plans to offer enhanced services via broadband in the upcoming months as the company adopts a more multi-faceted strategy for delivering content. The operator also is looking for more link-ups with mobile operators so it can derive revenues from platforms other than satellite. “Digiturk will be a key player in mobile TV. The three GSM operators, Turkcell, Vodafone and Avea, have acquired 3G licenses in the last year, and are planning to deploy their 3G services later this year. We are in negotiation with them in providing our premium content via their operating systems. Although a range of new services will develop in mobile TV, the value creation derived from those services is still uncertain. The business models, including the revenue sharing between the companies involved, still have to be carefully managed,” ÇavuÅŸoÄŸlu said.

            Digiturk is looking to expand from five HD channels to six by the end of 2009, and ÇavuÅŸoÄŸlu sees HDTV becoming profitable for Digiturk soon. “When you look at branding, introducing HD programming shows that Digiturk remains on the edge of the digital broadcasting experience, thus giving viewers the best TV has to offer. Introducing HD will also help to gain new subscribers resulting in a larger subscriber base. It will also help to gain or to retain subscribers in the upper demographics. It will also help us to limit churn, while the market matures and HD progressively becomes a new broadcasting standard,” he said.

More Competition in Turkey

Turkey is becoming a more competitive market and could see more competition with companies like Turk Telecom planning to launch an IPTV service, and there is another digital TV satellite platform, Dogan TV. ÇavuÅŸoÄŸlu is not sure what impact IPTV will have in Turkey but sees it as a more of a complementary, rather than competing service. “Currently, the broadband infrastructure in Turkey does not allow a fast increase coverage of DSL and [fiber to the home] that will let the consumers experience a TV-like content watching experience. At the moment, there are 6.1 million DSL subscribers in Turkey, of which 80 percent of them are signed to 1 megabit-per-second Internet speeds, limiting the economically addressable IPTV market to a very small portion of the Turkish population,” he says.

            In terms of how he views the competitive threat from Dogan TV, ÇavuÅŸoÄŸlu said, “Dogan TV introduced D-Smart in the beginning of 2007, trying to position themselves as Digiturk’s main competitor. On the contrary, we do not see them as a new competitor; we see them as the already existing competition of [free-to-air] set-top box offering, since they sell set-top boxes, not premium content or subscription. It is different to sell a [free-to-air] set-top box and very different business model to sell subscription pay-TV.”

            ÇavuÅŸoÄŸlu believes Turkey has strong dynamics for pay-TV, and the operator is in strong position to cater to this growing demand. “They (customers) have higher levels of disposable income than ever before but more time pressures in their busy lives. As a result, they are increasingly prepared to pay to get the most out of their leisure time. So we see a great opportunity of attracting more and more customers to our platform since they value the kind of products that we offer — great entertainment for the whole family, increased control and flexibility in how they watch, and the superior picture and sound quality of HD. Customers don’t care about pipes, platforms or plumbing. What they care about is great TV,” he said.

            While optimistic, economic conditions have delayed Digiturk’s planned initial public offering (IPO). “An IPO will always be an option for a dynamic company like Digiturk. It is true, like all other investment opportunities around the world, that the global economic downturn has postponed our plans in this area, but we will be looking into opportunities in the upcoming months,” ÇavuÅŸoÄŸlu said.