Despite increased prevalence of cord-cutting, traditional TV continues to be the most important medium in Latin America, both for viewers – with over 92 percent of reach among the population – and for advertisers – as TV accounts for more than 50 percent of the total ad spend in the region. In addition, TV is still the medium that people spend most time consuming, averaging three hours daily. For pay TV, the figure is still more impressive – almost three and a half hours daily per Latin American viewer. Argentinians spent the most time in front of the pay TV screen, coming to almost four and a half hours per day.
As a result, pay TV is still a profitable business in Latin America, generating more than 18 billion U.S. dollars in revenue. Brazil, Mexico, and Argentina share the region’s largest pay TV markets, based on both the revenue they generate and the number of subscribers. In Brazil, revenue from pay TV has surpassed five billion U.S. dollars and attracts around 18 million subscribers. In Mexico, the figures are nearly four billion dollars and 20 million subscribers, respectively. In Argentina, pay TV boasts 2.3 billion dollars in revenue and 10.6 million subscribers.
In terms of operators, DirecTV/Sky is the leading pay TV provider in Latin America with more than 21 million subscribers, each generating on average 34 U.S. dollars in quarterly revenue. When pay TV networks are considered, market leaders in the region are Turner, Fox and Discovery. It must be pointed out, however, that on country level, market leaders be different, e.g. in Brazil, Claro holds nearly 50 percent of the market, whereas in Mexico, Televisa is a clear frontrunner.
In order to push back against cord-cutting, pay TV providers might turn to solutions such as expanding both their definition of pay TV and the services they provide. Beside traditional services, over three quarters also offer TV Everywhere (access to services on different devices, such as tablets and mobile phones). More than 20 percent offer stand-alone over-the-top (OTT) services (such as Claro Video), which are also gaining popularity. These might be reasons why, among others, despite cord-cutting, the number of pay TV subscribers in Latin America is forecasted to increase to almost 95 million by 2021.