Digital TV is set to reach over 100 million homes in Western Europe by the end of the year, according to research released today.

Industry analyst and parent Informa Telecoms & Media said that the number of digital homes in the region is set to rise from 104 million by the end of 2008, to 157 million by 2013, equivalent to a 90 per cent penetration rate.

Digital TV penetration in Western European households broke the 50 per cent barrier in 2007, ending the year at 54 per cent, up from 42 per cent at the end of 2006.

But the analyst warned that despite the rosy picture, full digital conversion is only expected in four of Western Europe’s 15 major broadcast countries – Finland, France, Ireland and the UK.

The UK is currently the most prominent digital market, accounting for 25 per cent of the region’s digital TV homes, followed by France with a 20 per cent share and Germany with 17 per cent. But the UK’s dominance is under threat as other markets show improved digital growth rates and by 2013 Germany will lead the way with 19 per cent of the total market share.

Cable’s dominance in the digital TV space is also under threat. Adam Thomas, research manager at Informa, said that while cable will remain the region’s leading pay TV platform, the satellite subscriber base is eating into its lead. “Satellite’s much higher ARPU levels mean it will overhaul cable in revenue terms during 2009,” he said.

Digital terrestrial TV (DTT) is also expected to overtake cable in terms of subscribers in 2011. “DTT often provides a similar channel line-up to analogue cable, usually for no monthly fee, so will benefit from churning cable customers. IPTV is also using attractive triple-play bundles to tempt away cable subscribers,” Thomas said.