Pay-TV service revenue in Japan is forecast to see sluggish growth increasing from $6.1 billion in 2022 to $6.4 billion in 2027, registering a meagre compound annual growth rate (CAGR) of 1% as subscriptions continue to decline, especially for cable TV and direct-to-home (DTH) services, according to GlobalData, a leading data and analytics company.

GlobalData’s Japan Pay-TV Forecast (Q1 2023) reveals that the cable TV and DTH pay-TV accounts will decline at a CAGR of 0.2% and 0.7%, respectively, between 2022 and 2027. The decline in total pay-TV accounts in the country is primarily due to the cord-cutting trend exacerbated by growing customer migration towards OTT-based video platforms.

Srikanth Vaidya, Telecom Analyst at GlobalData, comments: “Aggregate pay-TV average revenue per user (ARPU) will, however, grow from $26 in 2022 to $29.2 in 2027 supporting the overall increase in pay-TV service revenue over the forecast period.”

Despite a steady decline in subscriptions, cable TV will account for the largest share of total pay-TV subscriptions over the forecast period. IPTV’s share of total pay-TV subscriptions, on the other hand, will increase to 22% in 2027, supported by growing fibre network coverage in the country, which supports the delivery of quality IPTV services.

Vaidya concludes: “KDDI led the pay-TV services market in terms of subscriptions in 2022. The company will remain the leading pay-TV service provider through 2027 due to its strong presence in the cable TV segment and growing focus on IPTV services. For instance, KDDI offers bundled packages combining pay-TV services with fixed broadband and telephony services to reduce churn rates and sustain competition from OTT service providers.”