Tet's new à la carte offering: the future of TV?

At the beginning of April, the Latvian operator Tet launched its new OTT platform, Tet+. Its particularity: a points-based system in which the user subscribes to an offer with basic channels and a number of points that can be allowed to buy access to more channels or to Tet's own SVOD service.

This is the first European deployment of an actual à la carte offer outside of Scandinavia, where this type of offer first emerged, triggered by different factors. Among them, the development of OTT platforms (Netflix and HBO for example arrived in the Nordics as soon as 2012), but also downward pressure on ARPUs on a very competitive market. In addition, customers were already paying for expensive TV packages containing a number of channels they didn't watch, which pushed operators to create offers that had high value for money. Increasing OTT fragmentation leading to a demand for multiple subscriptions by households finished setting the stage for the appearance of a new kind of TV proposition.

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In the Nordics, à la carte or do-it-yourself offers also contain SVOD services, typically offered alone for a high number of points, whereas some channels can still be bundled as premium packages dedicated to specific segments, such as premium sport which is very popular and helps maintain high ARPUs in the region.

Tet's platform presents a more restricted line-up as it does not include third-party on-demand services, but its core concept is nevertheless a breakthrough in the small Baltic market. There is no doubt it should be closely watched by operators even beyond the Latvian borders to see how customers and content providers will react to the DIY concept outside of the particular context of the Nordics, a very advanced market where OTT penetration is years ahead of continental Europe. At a time when most operators embrace their aggregation role, the lines are blurring between linear and on-demand, but also between broadcasters and OTT providers. Tet+'s success or failure could be a glimpse into the future of European TV - or an example of a groundbreaking idea that can't succeed outside of a specific environment.

Operators from all over Europe will gather to discuss their content strategies at our new digital event, Nextv Content Distribution. Join us and speakers from Vodafone, Deutsche Telekom, Movistar and many others on May 6th!

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