SVOD services continue local content push | VOD | News | Rapid TV News
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Research from Ampere Analysis has found that the global steaming giants such as Netflix and Amazon Prime Video are continuing to beef up their local content in international markets with an increasing focus on Asian markets such as Japan and India where localisation is key.
Ampere originalcontent 5May2020
The study found that the 15 markets spending the most on original TV content also represented 88% of the world’s SVOD revenue. For international players looking to compete in these territories, Ampere said that more extensive localised production was crucial in order to be able to compete with well-programmed local rivals.

Now surprisingly, the study showed that the US remained by far the biggest driver of original content expenditure, with local broadcasters and OTT services spending $36.5 billion on original content in 2019. US-based entities with global TV services – such as Netflix, Amazon and Apple – accounting for a further $4 billion in original content spend.

Ampere noted that Netflix alone has comparable original content expenditure to a market such as France or Brazil and its cash outlay on new productions would likely mean that within a few years, its amortised spend on original film and TV would overtake that of markets such as the UK and Germany. In total, 15 countries drive just over 90% of all global content expenditure. And while such as high percentage of original content spend originated from these markets, so too did 88% of global SVOD revenues. The conclusion was that viewers like consuming content that is culturally relatable and they’re willing to pay for it.

Along with the US, China and India were found by the report to have had the highest proportion of respondents regularly watching local content, with over 70% of Internet users watching local content very often in all three markets. Although US SVOD platforms have the largest proportion of local titles, with over 50% of content, countries in the Asia Pacific region follow closely. China, Japan and India also have relatively high coverage of local content, at over 40% of catalogues.

When examining content type, local preferences tend to skew towards films in India and Italy, but in other markets, consumers favour local TV series. This skew was highest in the UK, where Internet respondents watched local TV series 18% more than local films. In such TV-focused markets, popular local content can outperform even some of the largest and most successful international titles.

Looking at Netflix’s most viewed titles globally throughout March 2020, the proportion which are local varied across markets. Just over two-thirds of Netflix’s top titles in Japan were locally-produced.

In Europe, Spain was the most localised Netflix market, and 25% of the catalogue was now locally-originated. The research highlighted that Netflix has been increasing its investment in Spanish content, helping it boost appeal to its growing Latin American audience, which together with Spain, makes up around one third of international subscriptions. When considering language, 43% of Spain’s top titles on Netflix throughout March were Spanish, and 28% of the most-viewed titles in Mexico were Spanish.

In Japan, even though the absolute volume of Japanese content on Netflix in Japan has declined slightly over the last two years, the number of hours of local original or exclusive content has doubled, reflecting Netflix’s strategy of tailoring Japanese content to be more exclusive. Netflix’s Japanese catalogue represents the most localised catalogue of any of its international territories. Japan was also one of Amazon Prime Video’s biggest markets, with over 10 million  subscribers in 2019. And as English is not widely spoken in the country, local content is key.

“Although both Netflix and Amazon Prime are ramping up local content in international markets, it still represents the minority of their catalogues,” commented Ampere Analysis analyst Tingting Li. “In the majority of their markets, less than 10% of catalogues are locally-originated, and in some, government regulations, quotas and the impact of foreign OTT platforms are driving the trend to localisation. Looking ahead at in-production titles for Netflix for example, over 50% of all new movies and series will be produced outside the US.”