A region historically associated with low payTV penetration rates, Central America is starting to catch up with more developed Latin American multichannel markets. In only four years between 2008 and 2012, the region’s six largest markets saw combined payTV subscriptions expand from being present in only 21.4 percent of TV households to being available in 31.3 percent of homes.

Measured in nominal terms, this equaled to an addition of nearly 1.15 million new subscribers during the period, growing from 1.5 million payTV accounts at the end of 2008 to over 2.6 million four years later. Dataxis expects this upward trend to continue over the medium term. By 2018, more than 40 percent of TV households in the region (4.4 million) are forecast to subscribe to a payTV service—still leaving considerable room for future growth.

The new report (“Pay TV in Central America, 2012-2018”) found that, with over 647 thousand customers at the end of 2012, Costa Rica continued to be the largest payTV market in Central America, followed by Honduras, Guatemala, Panama, El Salvador and Nicaragua.

A regional analysis of the main payTV players currently operating in Central America showed that América Móvil (Claro) had become the largest provider of payTV services by number of active subscriptions. The Carlos Slim-owned group had rapidly increased its market share in the region from having 10.1 percent of all payTV households in 2008 to nearly 28 percent four years later. Such growth had displaced Millicom (offering payTV services in three Central American markets under the Tigo brand) from the top spot, although the Swedish group still commanded over 21.1 percent of total regional pay-TV accounts.

“While in 2008 the top-10 pay-TV groups in Central America concentrated 69 percent of the market, by 2012 the ten largest groups controlled over 83 percent of all accounts,” said Juan Pablo Conti, senior analyst at Dataxis and author of the report. “This emphasizes the way in which the industry has been consolidating in the region, a process that is far from over.”

Cable television was found to be the dominant technology platform for the delivery of payTV services in Central America. As of the end of 2012, 81.3 percent of all legal pay-TV accounts in the region belonged to cable operators (down from 94.3 percent in 2008). While Dataxis expects cable operators to continue to be the largest group of payTV service providers in Central America in the medium term, DTH platforms are poised to gain further market share at their expense. Satellite operators, which in 2008 controlled only 5.6 percent of total payTV subscriptions in the region, had increased such market share to 18.5 percent in 2012. By 2018, DTH companies are forecast to serve 28.4 percent of customers, pushing down the share of cable companies to 70.7 percent of the market.