‘n’ platform, owned by ITI in 75 percent and by TVN, ITI’s company, in 25 percent, wants to have 500,000 clients within two years. At the end of August, it had 335,000 of them. In the last two years, however, over 60 percent of new subscribers chose Cyfrowy Polsat, a digital platform owned by Zygmunt Solorz-Zak, the owner of Polsat television.
At first, ‘n’ offered many innovative technological products with high
quality. It also produces several own programs. But it’s hard to provide funds
for expensive business when there are so few clients.
“ITI platform chose a
bumpy road. It’s easier to first get subscribers and then improve technology.
Besides, next to technology, you must offer a good program as well”, Andrzej
Knigawka from ING Securities commented.
‘n’ is supposed to get out of the red in 2010, its fourth year of operations.
“We will invest in ‘n’. Sales and costs have so far been the same as we had planned. I don’t know any venture which would be profitable in less than three years”, Wojciech Kostrzewa, Grupa ITI CEO said.
Analysts, however, believe that it’s getting harder and harder for ITI and TVN to finance ‘n’’s development.
TVN holding EBITDA is negative, it has EUR 370m of debts. ITI Holdings will get the cash injection it needs so much because it sold a stake of ‘n’ and because TVN is buying back its own shares”, Andrzej Knigawka believed.
This year, a satellite platform of TP telecom will appear, next year TVP public television plans a similar step. In most European countries, there is only one platform while there may be as much as five of them in Poland. Market consolidation is anticipated.
“The end of the year is key for ‘n’. Unless it manages to reach 500,000 of
subscribers, ITI may try to sell it”, Jacek Silski, the CEO of the Polish
Chamber of Digital Radio Diffusion said.