Trends on the over-top-video market

1. Over the top video –
The turning point ?
"The Dynamics of Media and Content
Industries"
Copyright © IDATE 2012

2. 1. The TV market: some figures
 Advertising stagnating in EU
 Pay-TV still growing in EU
• Digitisation of cable
• IPTV
• Advanced pays services
TV commercial revenues in the EU (Billion EUR)
70
60
50
40
Subscription fees
30
Advertising revenues
20
10
 The USA market = 1.6 x EU
market
0
2003 2004 2005 2006 2007 2008 2009 2010 2011
(e)
Western Europe vs Eastern Europe TV markets in 2011(Billion EUR)
 Higher growth rate in the USA
(6% in 2011) than in the EU
(2%)
2001 growth
rate: 11%
12
Western Europe
Eastern Europe
73
2
Copyright © IDATE 2012
2001 growth
rate: 11%

3. 2. In the USA: an overview of leading video OTT services
•4 dominant models: Bonus, Ads, VOD, SVOD
•Syndicated Catch-up TV Vs channel by channel
•A momentum for SVOD as Movies + full TV seasons
Ads
HBO GO
Free online Add-on to HBO for
1400 programs
subs
Hulu
Free, Ads
ABC
YouTube
Bonus
Free, Ads
Free, Ads
Apple Itunes
VOD
Amazon Instant Video
43 000 TV titles
2200 movies
2000 TV titles
?
Purchase, 1.99-2.99 USD per TV
content, 9.99-19.99 USD per
45000 titles
movie
Rent, 0.99-4.99 USD per movie
Rent, 0.99-3.99 USD per movie
Purchase, from 1.99 USD per TV
content, from 11.99 USD for all 120000 titles
the season, from 14.99 USD per
movie
Catch-up TV + 1 day
Catch-up TV + 1 day
Movies: back catalogue
Catch-up TV + 1 day
Niche content
TV : past seasons
TV : day after airing
Movies : same as DVD release
TV
:
day
after
airing
Movies : same as DVD release
Amazon Prime Instant Video
SVOD
Subscription: 79 USD/year
18000 titles
TV
:
past
seasons
Movies : back catalog
Hulu Plus
Subcription: 7.99 USD/Month
54000 titles
3300 movies
TV: past seasons
Catch-up TV + 1 day
Movies: back catalogue
Netflix
Subcription: 8 USD/Month
20 000 titles
TV : past seasons
Movies: from 28 days after
DVD release
Copyright © IDATE 2012

4. 3. In the USA: SVOD does seem to make a difference
•NetFlix has made a difference, converting its DVD rental + free streaming
subscribers to 21m+ streaming only subscribers
•Windows for movies starting at 11 months
•But impacts of new contracts yet to come
Online video markets in the USA, S2 2010 – S1 2012 (Billion USD)
Copyright © IDATE 2012

5. 4. In the USA: Managed networks fight back
Comcast On-demand services
•Comcast proposes a competitive
service, leveraging on its existing
customer base.
•Managed networks distributors quicly
moved to a multiscreen availabilty of
their services.
•And they retain control (so far) of the
TV screen
•Managed On-demand services lead
the market, at least on VOD movies
rental
Comcast on-demand services
Catch-up +1 day
Free
Xfinity TV
Xfinty On Demand
VOD (DVD Release)
Depends on films and series
Xfinity StreamPix
Movies: Back catalogue From 4.99 USD
TV: Past seasons
Free for high end subs
Multiscreen availability of On-demand services
Managed TV
Internet PC
Internet TV
Tablets
Smartphones
Amazon
Apple Itunes
Hulu
Netflix
Comcast
AT&T
HBO GO
Share of Paid VOD movies rentals – USA S1 2012
25%
20%
15%
10%
5%
0%
Comcast
Copyright © IDATE 2012
Source: NPD
DirecTV
Time
Warner
Cable
Apple
Itunes
Verizon
DISH

6. 5. In the USA: So far, on-demand video seems to gain from DVD…however first signs
of linear audience and in pay-TV subs decrease
Physical and digital video in the 2004-2011 (Billion USD)
Video usage in the USA per month (mn per user)
Changes in video subs in the USA (000)
•VOD does not match-up losses in DVD
400
300
•Q1 12 shoes a first decrease of linear TV viewing in the
USA
•Net loss of pay-TV subs in Q2 2012, but turnover still
increasing
200
100
0
-100
Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012
-200
•All trends still to be confirmed
-300
-400
Comcast
Copyright © IDATE 2012
Time Warner Cable
Verizon
AT&T
Dish
DirecTV

7. 6. In Europe: Uneven network roll-out and uneven role of OTT
•Footprints of Digital Cable and IPTV strongly differ in Europe…
•Leading to contrasted situations in terms of the weight of OTT and managed on the
on-demand market
Native VOD ready-households (excluding hybrid) in Europe
Breakdown of the on-demand-video market between Managed networks and
OTT (2012)
100%
90%
80%
70%
60%
50%
OTT
40%
Managed
30%
20%
10%
0%
France
UK
Germany
Source : IDATE estimates
Copyright © IDATE 2012

8. 7. In Europe: the OTT landscape has built-up on a country per country basis
Connected TV services in Germany (2012)
Connected TV players
Vodafone
Unity
Media Cable
Kabel
Deutschland
●
Kabel BW
●
Deutsche
Telecom
Western
Digital TV
Live Hub
VideoWeb
Sony
PlayStation 3
●
●
Sony
Internet TV
●
Sky+box
Sharp Aquos
Net+
Samsung
Smart TV
Philips Net TV
8
Panasonic
Viera Connect
Microsoft
Xbox Live
Loewe
MediaNet
LG Smart TV
Humax iCord
Apple TV
Broadcasters’ services & content
ARD Mediathek (catch-up
●
TV)
Cartoon Network content
Discovery Channel
Disney
Eurosport content
France 24 content
●
Kabel Eins video (catchup TV)
MLB.TV
●
National Geopraphic
ProSieben video (catchup tv)
RTL now (catch-up TV
and VoD)
Sat1 videocenter (catchup TV)
Sky content
ZDF mediathek (catch-up
●
TV)
Online video content competing with TV programmes
ABC TVOD
Acetrax
●
Cinema
On
Demand
(unitymedia)
Dailymotion
●
●
iTunes
●
Kabel BW Videothek
LoveFilm
Maxdome
●
●
PlayStation Store Video
Store
Unitymedia videothek
Video Unlimited
Viewster
●
●
Internet access players
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Copyright © IDATE 2012
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9. 8. In Europe: Leading USA players launching
•Netflix, Amazon, HBO…launching in Europe
•With national or regional services
•Benefiting from scale economies ?
•With different rules of the games than in US: HBO GO serving non-cable subs in
the Nordic countries
•Pushing “managed” on-demand services to go OTT, as SkyNow in the UK or Canal
Infinity in France.
US-based on-demand services launchs in EUrope
UK, Ireland, Denmark, Finlnad,
Norway, Sweden
Amazon
UK, Germany, Sweden, Denmark,
Lovefilm
and Norway
Apple iTunes Europe
ABC
Netherlands, France
Netflix
OTT
OTT
OTT
OTT+Managed
HBO
Netherlands, Denmark, Finland,
Managed+OTT
Norway, Sweden, Eastern Europe
YouTube
Europe
OTT
Copyright © IDATE 2012

10. 9. Europe: questions on the audiovisual industry
competitiveness
• Should Europe aims to create a Netflix-like or build on its strength: TV channels,
distributors, movies production ?
• Should the approaches to movie and TV programs production be more differentiated ?
•Regarding TV production, what should be the role of independent production ?
• What is the right model: favoring the circulation of rights or an integrated management of
widows by TV channels ?
• Is there a risk that separate digital/on demand rights favor US players ?
• Is SVoD the entry path to pay-TV for FTA channel ?
• Outside movie production, is there a certain level of better internationalization of the TV
players:
•Through more implication of TV channels in TV production
•In the case of PSBs, through common niche channels (eg children channels).
Copyright © IDATE 2012