Nordic video markets riding high | Media Analysis | Business
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An accelerating SVOD industry and a return to growth for transactional video have been the drivers for the Nordic video markets to be some of the strongest and most progressive in the world says research from Futuresource Consulting.
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In its look at the market, the analyst noted that Sweden, Denmark, Norway and Finland enjoy high penetration of superfast broadband, wide adoption of the English language, a thirst for entertainment and a high level of disposable income. And while SVOD growth is regarded as impressive, it is the sight transactional video shifting course and moving into a growth phase that is indeed something of a rarity, Futuresource believed.

“[Sweden, Denmark, Norway and Finland] are expected to be amongst the first markets to experience the reversal, a direct result of changing consumer behaviour in the face of Covid-19 said Futuresource Consulting market analyst Tristan Veale. “We expect transactional video buying or renting across DVD, Blu-ray and digital to grow by 4% in 2020, the second consecutive year of growth. Whereas globally, DVD and Blu-ray declines typically tend to outweigh any digital growth.”

Futuresource added that the biggest player in the digital transactional space remains Apple, though key growth service Viaplay is successfully upselling transactional video to its existing subscriber base and is a close second. It added that despite the rise in transactional video, the market is dominated by SVOD, which accounted for 80% of Nordic home video spend in 2019, with Netflix, Viaplay and HBO Nordic the standout services.

“The Nordic love affair with SVOD continues to blossom,” Veale added. “In 2019, for every dollar spent on transactional video, four dollars were spent on SVOD. Yet, there is plenty more opportunity for growth. With three major established services in the shape of Netflix, HBO Nordic and Viaplay, and new entrant Apple TV +, which launched in Q3 2019, plus the upcoming Disney+ launch, we expect subscriptions and spend to be pushed to a whole new level.”

On Netflix subscriptions alone, consumers across Sweden, Norway, Denmark and Finland spent over half a billion dollars in 2019 and Netflix remains the leading SVOD provider, but it is slowly approaching saturation, as over half of all households across these four Nordics have a subscription. Indeed it is local player NENT, which is building a media conglomerate across the Nordics and which on 30 April was given approval to merge Viasat operations with Telenor’s Canal Digital satellite operations in a new joint venture, Allente, that the analyst says is the one to watch.

“Not only will [the joint venture] bring economies of scale into play and produce a raft of cost savings, it will also offer TV distribution via satellite, streaming services and IPTV services, as well as delivering fibre broadband to 1.2 million customers across Norway, Finland, Denmark and Sweden,” Veale remarked. “What’s more, NENT group has entered into an agreement that Viaplay will be available to Allente subscribers and Canal Digital subscribers, boosting the reach of the SVOD and TVOD service even further.”

As with other regions, pay-TV services across the Nordics are expected to see a fall in subscription revenue and advertising revenue because of Covid-19 impacting the ability to air key content such as sports and delayed TV series. However, Futuresource Consulting believes that the long-term outlook for pay-TV seems solid.