German operator Freenet said it expects to reach 800,000 pay-TV subscribers for its DVB-T2 service by the end of this year, generating ARPU of EUR 4.50 per month. At its capital markets day, the company said the DVB-T2 offer launched at the end of March had around 1.2-1.5 million users at the end of the first quarter, of which around 160,000 were considered on the paid offer.
The free digital offer provides access to the 20 public channels, and customers can pay another EUR 5.75 per month to receive 20 more HD channels as well as catch-up services, apps and other interactive features. Freenet is offering the paid service free until the end of June. The company aims to grow the total terrestrial TV base to more than 2.5 million by the end of 2017. Paid subscribers should reach more than half a million by mid-year and 800,000 by the end of 2017.
Freenet also announced that it has reached more than 150,000 registered users of its IPTV service Waiupu.tv, first launched in late September 2016. Around 25,000 of the subscribers pay for additional services, a three-fold increase compared to the end of 2016. Freenet targets over 250,000 registered users for Waipu.tv by mid-year, of which over 50,000 paid, and the number should pass half a million registered users and 100,000 paid subscribers by the end of 2017. ARPU is expected to reach EUR 6 this year.
Freenet entered the TV business last year, as a new growth area, and said it was pleased with the initial launch results and optimistic about the coming months. The new services are expected to lead to "slightly higher" revenues and EBITDA in 2017 and 2018, and the company targets stable cash flow of EUR 310 million in 2017 and a slightly higher amount in 2018.
The growth in TV will offset expected flat sales and EBITDA at its mobile business this year. Freenet said it expects to grow mobile customer numbers and stabilise postpaid ARPU in 2017.
The group forecast excludes the company's stake in Swiss operator Sunrise.
