Following a year of rapid development which saw major content owners announcing direct to consumer plans, ongoing SVoD growth, channel innovation, and even more investment in scripted content, senior media executives have forecast continued growth in key areas throughout 2019, according to the The 3Vision annual Trends Survey.
The survey collates feedback from content owners, distributors, pay-TV platforms and technology vendors globally. The survey covers major industry areas including content licensing, drama production, pay tv initiatives and D2C services.
Executives believe that free TV will continue to enhance their proposition to consumers and advertisers, meeting viewers demands for content on their own terms with enhanced catch-up (in-season stacking) and box-sets on adjacent digital services.
Data from the 3Vision Show Tracker points to significant growth in major markets with in-season stacking, and an increase in broadcasters releasing full series at the same time as linear premiere. SVT (Sweden) released The Bold Type exclusively on their FVoD service, ABC (Australia) released Killing Eve on ABC’s iView two months prior to linear release, and there are many more examples. This increased utilisation of rights is feeding into significant changes in the licensing markets, and respondents expect more. EVP at 3Vision, Jack Davison says “this departure from broadcasters offering just limited catch-up on digital services is increasing the value in the first licensing window, and distributors are working through what this means for 2nd window revenues and the ultimate revenue profile of shows.”
A key issue today is not just the value of the second window, but how willing broadcasters will be to license shows that have been on SVoD. With many more shows coming back to the market after an SVoD first window, 2019 will be an interesting year. Some 55 per cent feel that broadcasters will start to offer more shows in a second window after SVoD.
Over half of respondents expect drama production levels to increase this year (up 43 per cent from last year). In addition to respondents expecting further growth, fewer people believe production has peaked.
For the second year running the integration of SVoD services remains the most important pay-TVoperator feature set; 86 per cent of respondents believe that pay-TV operators should be enabling their consumers to access SVoD services via bundling and/or integration. In 2018 Sky in the UK and Germany bundled Netflix with their Box Sets, effectively offering Netflix for a reduced fee. Davison says “Operators who have been strong in building their own channels and services are now willing to fully embrace the importance of Netflix to their customers, and the belief that they are not competing for subscribers outweighs any issues over their competition for content and customer revenue”.
Notable changes from the 2018 results include the significantly reduced expectations by players for video growth opportunities in the Middle East and Africa, with both decreasing their ranking position. Director at 3Vision, Hayley Bull says both markets have faced a turbulent 12 months with increased political turmoil and piracy affecting the Middle East and the closure of Econet’s pay-TV service in Sub-Saharan Africa – the last challenger to incumbent MultiChoice.