Kate Bulkley, Media Analyst.

Battle lines are drawn in SVoD

By Kate Bulkley

Broadcast News

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For Broadcast July 21, 2016

Content and curation are key to standing out, says Kate Bulkley

Summer 2016 has already had plenty of battles. After May v Leadsom and Murray v Raonic, it’s now time for Netflix v Amazon. Or should that be Netflix and Amazon v the rest of the TV business? Will the next phase of SVoD services be defined by Netflix’s newly acquired Star Trek franchise competing with the three middle-aged men on Amazon’s The Grand Tour?

In the beginning, the TV world did not worry too much about Netflix or Amazon. They were considered fringe services, for a niche group of users. But that has changed: subscribers began signing up and big cheques started being written to buy content. Everyone with a back catalogue was suddenly a lot more interested in these pay-TV-lite SVoD services.

Then big-time commissioning kicked in, including Netflix’s reported £100m order for The Crown from Left Bank Pictures and Amazon’s fashion saga The Collection from Lookout Point. In the UK, Broadcast has reported that Amazon is aiming to launch five non-scripted series this year and another 10 in 2017. Meanwhile, Netflix wants UK producers to bring it character-led shows with an edge.

But I wouldn’t count out the local players just yet. Sky’s Now TV Combo, which bundles TV, phone and broadband together on a contract-free basis, is about playing an offensive game. In Germany, the Maxdome SVoD service, which is owned by commercial broadcaster ProSeibenSat 1, is doing the same, inking an exclusive distribution deal with Deutsche Bahn for an on-board SVoD service on 300 of Germany’s fast trains.

Maxdome has also commissioned its first original content, a Curb Your Enthusiasm-style series with local talent set to air early next year. The idea is to both differentiate its service and to build an IP library.

Today, less than two-thirds of on-demand viewing through the All 4 platform is catch-up, underlining why Channel 4 plans to bolster investment in online original content. About 10% of its digital-first commissions are funded by brands, according to Enders Analysis, but the amount of brand-funded, online-first content is expected to grow fast, offering opportunities for indies as well as for broadcasters wanting to differentiate their local VoD and SVoD services.

C4 recently invested in Barcroft Media, which specialises in viral videos, and Jonathan Allen, C4’s commercial chief, will join the Barcroft board to gain insight for the broadcaster’s work with brands. C4, like the BBC, is also starting to co-produce with SVoD players, such as its six-part drama with Netflix – aptly called Kiss Me First.

The other battleground is curation. Netflix is already an expert in serving recommendations based on previous viewings, but curation is moving beyond algorithms. In April, Maxdome launched ‘Maxperts’, with 20 staff writing up recommendations, as well as local celebrities offering their views on what to watch.

Both Star Trek and Jeremy Clarkson are proven brands that should resonate across territories and ensure that the Netflix v Amazon battle will run and run. I’m interested in how local rivals will try to beat these two at their own game. Drivers, start your engines! ­

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