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CSTB'2007: Besides the Russian winter, it's all about new TV offerings and media-telco convergence [20.02.07]

Oh, that Russian frost! This year the Cable Satellite Television and Broadband (CSTB) exhibition moved from the cozy Sokolniki to the Crocus Expo Center, which is somewhat far from the city center. Add to this freezing Moscow temperatures and huge lines for the buses that were carrying people to the Crocus site, and you will understand that one needs to be an enthusiast of this market segment to actually go… 

Nevertheless, cable and satellite television, high definition and pay TV, broadband services, mobile content and radio broadcasting companies were represented in full in this, the only Russian expo for this market niche. This year some 550 companies from Russia and CIS, China, France, the U.K., Italy, Israel, Germany and the U.S. presented their latest products and services at the show. In total, representatives of 28 countries and over 15,000 visitors came to Moscow for CSTB’ 2007. 

Among the most popular was the broadband segment of the show. Visitors flocked to the booths of vendors and system integrators to see their offerings in multi-service network solutions.  Russian operators pioneered new digital TV formats. Volga Telecom, the largest operator in the Volga Federal District, implemented DVB-C and IPTV projects in Chuvash Republic in 2006, where over 125,000 of the republic’s capital of Cheboksary received access to 60 channels, 28 of which broadcasted in DVB-C format. In the Russian northern port city of Murmansk, operators built several new home networks, and penetration grew to 70%. Only during 2006 some 40,000 households were connected to multi service networks. 

Cable production is only growing in Russia. According to ElectroCable Association, the Russian fiber optical and LAN cable market grows 30-35% annually. At CSTB’ 2007 a good number of companies presented their production, including Corning, Eliks Cable and many Asian vendors. 

CSTB participants also noted that the growth of usage of IP/MPLS-based data transmission networks is imminent. While Russian operators prefer to use their own networks, the amount of leased capacity is gradually growing. 

At the round table dedicated to this dynamic market representatives of operators discussed the prospects of development of pay TV in Russia. Most of them agreed that pay TV has become a leader in quality of content and popularity among Russian users. The only problem that was emphasized was a lack of local quality content.  This year the Russian pay TV market should double and reach USD 700 million and by 2010 should exceed USD 1.5 billion. According to MTU-Intel by 2010 the broadband penetration will be 30-40%, and pay TV penetration will grow to 20-30 %. The number of cable, satellite and IPTV subscribers grew to 270,000 people in 2006. 

The main trend of the Russian pay TV market is furthering consolidation and construction of new network infrastructure. The subscriber base will probably double in 2007.  According to analysts, the investments in pay TV will grow three times. And all this is possible due to rising purchasing power of Russian subscribers and increased range of services offered to pay TV customers. 

The World Content Show presented at CSTB demonstrated the best pay TV channels, including Russian and international channels by MTU-Intel, BBC, Discovery, MTV and others. Many speakers identified the fact that Russian subscribers want to see more and more local content, but unfortunately, not much quality content is available. 

At CSTB Awards' 2007 Russian vendors reaped most of the awards.  Kontur-M and TelCo were awarded for their unique digital TV solutions. 

Russian mobile content market: the “Call TV” phenomenon and much more

The Russian mobile content market is feverish: the sudden birth of this golden goose brought Russian content providers (CP) in 2001 some USD 5 million, but by 2006 this market reported over USD 400 million in revenues What was the main growth factor last year? CSTB mobile content participants agreed that it was media content services. TV lottery and voting contests alone brought USD 100 million.The “Call TV” format is simple. The TV show anchor asks TV watchers to call from their mobile phones and get the right answer to simple contest for a large monetary award. This bears a huge wave of calls, while only a fraction of them are getting through to answer the test. Yet, the connection costs about USD 1.5, and the generated revenues are divided between mobile operator (50%), TV channel and CP.  Champions of “Call TV” are Russian CPs SMS Media Solutions and Neva Online, which topped the CP ratings in 2006 just by implementing several projects with large TV channels.

Russian Satellite Operators announce the launch of new satellites.

Last but not least, Russian satellite moguls, Russian Space Communication Company and Gascom, presented their exciting projects at CSTB’ 2007. Naturally, with Russia’s sheerness and growing economy, the satellite market is only set to grow. Estimates put the market size at some USD 650 million with an annual growth of over 30%.  

And what did these two giants have to offer? Both operators will expand their satellite capacity in 2007 and 2008.  Russian Space Communication Company transformed all broadcasting via its satellite networks to digital technologies. Currently the operator distributes some 115 programs on Russian, CIS and international channels. In the end it formed the new compression center in MPEG-4 standard, that allows it to expand the number of broadcasted programs and shift to high definition TV. Over all, RSCC offers a full palette of services, including IPTV and VSAT.

By 2015 new launches will increase the RSCC capacity by 580  transponders.  The launch of Yamal - 300 in 2008 will increase the capacity of Gazcom group by 52 transponders. By 2015 this will bring the Russian satellite communications system close to EvtelSat, IntelSat-PanamSat or SES Global. RSCC plans to launch at least 15 more satellites further west and east in the spots allocated by International Organization of Space Communications (IOSC) INTERSPUTNIK.