Market Watch

Canal Plus Spain Launches on Ono Cable Network


Display Driver IC Forecast


Prisa has continued its strategy of making premium channel Canal Plus available on a wide range of platforms by signing a deal with Ono, the country's largest cable operator.

Canal Plus - which until this year was exclusive to Prisa's Digital Plus satellite platform - will be added to Ono's offering from 1 December. As well as the linear channel, subscribers will be able to access on-demand content. Canal Plus will be available to Ono's subscribers to the Extra or Total TV package and will have a cost of €16.90 euros a month. As an introductory offer, the channel will be free in December and at half-price in January and February 2010.

Canal Plus content includes sports - including an exclusive Sunday-night football match from La Liga - first-run movies, TV series and music. Canal Plus launched on cable operatior Telecable and IPTV services Jazztel and Orange earlier this year.

Analysis
Up to now, Prisa's pay TV division (previously named Sogecable) viewed other platforms as competition and refused to allow its channels to be distributed on them. A continuing decline in Digital Plus (the platform lost 136,000 net subscribers in the year to Q3) and Prisa's financial difficulties are behind its change of strategy. In addition, Telecinco and Telefonica now own 22 per cent apiece of Digital Plus following a merger deal agreed at the end of last year.

The deal will benefit both parties: Ono has a subscriber base of almost a million TV subscribers so even if five per cent take the premium channel, Prisa will gain an additional €10m in revenues. Ono has been losing TV subscribers since Q3 2008. Cable television customers decreased by 29,000 or three per cent in the last 12 months to reach 948,000 as of 30 September. Cable television customers as a proportion of total customers decreased by 1.3 per cent to reach 52.4 per cent as of 30 September 2010. Having Canal Plus on their service will increase its chances to win new subscribers and to reduce churn rate in its existing base. The company has also signed a strategic agreement with TiVo to develop a next generation TV service that will help increase customer stickiness.

Adding both things together, 2011 could be the beginning of a recovery for Ono and the generation of extra revenues for Grupo Prisa TV.

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