Kate Bulkley, Media Analyst.

‘Big local’ is key to SVoD wars

By Kate Bulkley

Broadcast News

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For Broadcast April 24, 2019

With giants like Disney entering the fray, niche players need a global mindset, says Kate Bulkley

Game Of Throne’ warring factions and flying dragons returned last week and of the 17.4 million overall US viewers it attracted on the Sunday, plenty streamed the opening episode on HBO apps or watched one of two catch-up broadcasts offered on the linear channel. It was HBO’s “largest night of streaming activity ever”.

There is a seismic shift in how audiences discover and consume content, encompassing big TV shows like Game Of Thrones and underpinning the strategic imperative for more niche offerings like Discovery’s forthcoming BBC-powered natural history streaming service.

Broadcasters and studios are adjusting what they offer with better online catch-up services and, increasingly, paid video streaming – from Fox News launching Fox Nation to showcase right-leaning personalities to Disney+ having exclusive US rights to the first 30 series of The Simpsons, which the company obtained when it acquired 21st Century Fox’s entertainment assets. (The best part of Disney’s presentation was a montage of Homer and gang trying on Mickey Mouse ears with a portrait of Rupert Murdoch off to the side in a bin.)

Disney’s full-frontal entry into the streaming wars includes $1bn (£766m) for original programming in 2020 – a mere bagatelle compared with Netflix’s $13bn (£10bn) spend – but Disney has a deep film and TV library and the pricing significantly undercuts its rival. No wonder Netflix shares tumbled 5.4% after Disney+ was unveiled.

“Niche plays like the planned joint ITV-BBC Britbox service will need to be distinctive to compete”

However, the subscription streaming wars won’t be a zero-sum game, especially for bigger players. Niche plays like the planned joint ITV-BBC Britbox service will need to be distinctive to compete, otherwise SVoD fatigue will set in.

Britbox will commission originals, but co-commissioning with its eponymous US service, which already has more than 500,000 subscribers, would give it more fi repower.

There has also been a pivot to the less high-profile ad-funded VoD (AVoD). Viacom has aggressive international plans for its recently purchased US platform Pluto TV, while Tubi TV and Xumo may be planning international rollouts of their own.

Amazon recently launched its AVoD offering Freedive, while AT&T’s sale of its 10% stake in Hulu put a $15bn (£11.4bn) valuation on the streamer, which is the poster child for AVoD despite having several pricing tiers.

VoD’s growth is affecting commissioning, especially in places like Scandinavia, where the speed of consumer adoption of digital has driven viewer migration.

Nordic Entertainment Group (NENT) chief executive Anders Jensen told me at Mip TV that along with doubling the number of originals on SVoD service Viaplay from 20 to 40 a year, ad-funded, on-demand service Viafree is a priority because “AVoD is becoming a sort of knight in shining armour”, with linear channel advertising under pressure.

NENT, which was born out of European media group MTG, has shifted from a linear-first model to a cross-platform commissioning strategy. All scripted originals premiere on Viaplay before moving to the free-TV platforms.

This is a model that will likely be replicated in other markets. NENT has invested €350m (£304m) in its streaming platform and now wants more coproduction partnerships like those it has with Studiocanal, MGM and the UK’s FilmNation.

Its upcoming thriller Shadowplay stars True Detective’s Taylor Kitsch and Dexter’s Michael C Hall and was created by The Bridge’s Måns Mårlind. There are several co-production partners, a model that means it will premiere across the Nordic region exclusively on Viaplay.

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