TV Industry Trends - 2019 Survey - January 2019 - AWS
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TV Industry Trends - 2019 Survey January 2019
TV Industry Trends - 2019 Survey Survey Background The 3Vision annual Trends Survey collates feedback from senior media executives. Respondents are from global markets, and are asked to share their views on key areas. Respondents include content owners, Pay TV platforms, distributors, and tech vendors. Topics included major industry areas such as content licensing, drama production, pay TV initiatives and direct to consumer services. Survey responses were captured from mid- December to mid-January. 2 3Vision Trends Survey 2019
TV Industry Trends - 2019 Survey Overview 2018 saw more rapid developments in the television industry. Pay TV continues to innovate at pace, shifting their spend from linear channels to on demand and other initiatives as they fight to grow. SVOD continues to grow and drive change in the content market whilst broadcasters respond by improving their offer for consumers (and advertisers) with in-season stacking, digital exclusives and box-set premieres to mention a few. Consolidation, direct-to-consumer, AVOD, social video, telco VOD and the increasing amount of value in the first window for content were just some of this year’s themes. We asked our global network of industry executives for their thoughts on what we can expect from the market over the next 12 months. 3 3Vision Trends Survey 2019
TV Industry Trends - 2019 Survey
Video Market Potential
59% Video markets with most growth potential 2019
Respondents ranked Asia as the #1 market for
growth in 2019
Asia topped the rankings again and was the top 14%
8%
pick for more respondents this year. Europe is the
only other region with a year-on-year increase. 4% 59%
The outlook for the African market is less positive
10%
than last year (dropping down from #2), perhaps 6%
reflecting discontent following the closure of
Kwese’s DTH platform and the lack of any major
competition in the anglophone market for DStv.
% % of respondents selecting the market as their #1 pick
The Middle East continues for all to be a market
that is challenged by geo-political issues.
4 Q. Please rank the following regions in the order you expect to see most growth in Video market value over the next three years (1 = most growth, 6 = least)
TV Industry Trends - 2019 Survey
Pay TV Initiatives
Pay TV Operator Feature Set Importance
Integrating
86%
‘18
71%
86%
SVOD services
TV
Believe that Pay TV operators should be
78% 48%
Everywhere focused on integrating with SVOD players
Home gateway/ 39% 33%
multi-room/screen Perhaps mirroring Netflix’s recent launch on
Start Movistar (Spain) and Sky (UK and Germany),
34% 17%
Over
Network and the increased activity by Amazon, the
32% 33%
PVR importance of SVOD to Pay TV subscribers
4k /UHD
Content
8% 33% was the leading issue for respondents.
Voice
Control
5% n/a Fewer respondents rated the importance of
Electronic 3% 12%
4K (perhaps reflecting the lack of content),
Sell Through
and new innovations such as voice control
Virtual Reality 2%
Content
7% and virtual reality remain a low priority.
% of respondents choosing the named feature
5 Q.Which of the following do you think are the most important features of Pay TV? (please select up to three)
TV Industry Trends - 2019 Survey
Pay TV Initiatives Comment - Sky and Netflix Q4 2018 Integration
In Q4 Sky launched Ultimate On Demand - adding Netflix to their platform like many other operators - but going
a step further, offering it bundled with their own content product at a discounted rate.
The Ultimate On Demand package costs £10 per month, and is added to a Sky Q subscription, giving access to
Netflix Standard worth £7.99 and Sky Box Sets worth £5 for a bundled cost of £10, a saving of £2.99.
Viewers wanting to access Netflix in UHD can subscribe to Netflix’s Premium plan (an additional £2), and
subscribe to the ‘Sky Q Experience’, Sky’s new name for Multiscreen which costs £12 p/m.
Old New
Entertainment TV Pack & Box Sets Entertainment TV Pack & Ultimate On Demand
Sky Box Sets £5.00 Sky Box Sets £5.00
Netflix (Standard) £7.99 Netflix (Standard) £7.99
Unbundled Cost £12.99 Ultimate bundle £10.00
Saving £2.99 (23%)
6 Source: Sky Releases
TV Industry Trends - 2019 Survey
Virtual Pay TV (VPTV) Developments
57% Expectations for the Virtual Pay TV Market in 2019
‘18
Believe there will be growth in the Virtual Pay TV
market in 2019 The Virtual Pay TV
model will grow 57% 25%
globally
Unlike last year respondents feel growth will not be
limited to the US and the opportunity is global. Virtual Pay TV will
continue to grow but 9% 28%
VPTV services outside the US have so far tended only in the US
to be skinny Pay TV offers from existing operators
such as Canal Start (France), WAVO (UAE), Growth will be small
in both the US and 35% 40%
Magenta TV (Germany), and Now TV (UK). worldwide
2019 may see growth of standalone full VPTV in
global markets - with challenges securing rights There will be either
no growth in the 0% n/a
and feature sets (especially with Free TV), but market or a decline
channels may start to view them in a more
favourable light as they look for growth.
7 Q. In 2018 Virtual Pay TV (Virtual MVPDs) grew mostly in the US. What are your market expectations for 2019?
TV Industry Trends - 2019 Survey
Virtual Pay TV Comment
Virtual Pay TV has seen growth in the US, but for existing AT&T Video Net Adds (000s)
600
operators launching their own virtual services on top of DirecTV Now
traditional offers comes with challenges - AT&T’s issues U-verse 267
450 DirecTV
with DirecTV Now are apparent in their numbers. 368 342
342
300 328 323
296 312
235
214
150 152
72 49
49
26 1 24 13
0 -156 -251 -147 -188 -286 -359
13
-92
-240 -262 -233
-150 -326 -60
-382 -391
-195
-300 -134
Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18
8 Source: AT&T Quarterly Report Q3 2018
TV Industry Trends - 2019 Survey
Content Owner Direct-to-Consumer (D2C)
68% “Most large content
owners will launch their 17% 15% 43% 25%
Believe the majority of large content owners own D2C service in 2019”
will launch D2C services in 2019
“More content owners will
go D2C through platforms 13% 13% 52% 18%
70% like Amazon Channels”
Strongly Disagree Slightly Disagree Neither Agree/Disagree
Believe more content owners will launch Slightly Agree Strongly Agree
D2C services through Amazon Channels
The majority agree D2C activity will increase Amazon Channels Growth (currently in US, UK, Germany & Japan)
this year with an expectation that many of these US Market International
content owners will use Amazon Channels. 160
No. of Channels
2017 2018
Amazon Channels is set to launch in more 120
countries with channel numbers growing. How 80
50
72
52
40
it grows as an aggregator of the future will be a 40 30
0
key area to follow. Q4'15 Q2'16 Q4'16 Q2'17 Q4'17 Q2'18 Q4'18 UK GER JAP
9 Source: 3Vision Analysis of Amazon Services, November 2018
TV Industry Trends - 2019 Survey
Global SVOD Co-Productions
77%
“Global SVODs will
increase co- Agree that Netflix and Amazon will
13% 8% 42% 35%
productions with increase co-productions with local players
local broadcasters”
The majority felt that local co-productions
Strongly Disagree Slightly Disagree Neither Agree/Disagree
with Netflix and Amazon will continue to
Slightly Agree Strongly Agree grow across global markets.
10 3Vision Trends Survey 2019TV Industry Trends - 2019 Survey
Local Collaboration
“There will be an
68%
increase in local Expect more local collaborations to increase local
collaboration as they 10% 18% 50% 18%
combine strengths leverage against Global SVOD players
OTT”
Although prospects vary, there is an expectation
Strongly Disagree Slightly Disagree Neither Agree/Disagree that following on from more announcements in
Slightly Agree Strongly Agree 2018 there will be more local collaboration in 2019.
11 3Vision Trends Survey 2019TV Industry Trends - 2019 Survey
Drama Production
Expectations for Drama Production
Inner ring (2018)
52%
5% Outer ring (2019) Believe that drama production will grow in 2019
7%
Up from 43% last year, respondents expect
13% drama production levels to continue to grow.
10%
43% Pessimism is also on the decline, with only 7%
52% believing production levels have now peaked
37% versus 10% of respondents last year.
35%
Whilst US data shows the ongoing domestic
growth caused by SVOD, there are clearly also
Production levels will continue to grow in 2019
numerous European and global initiatives
Production levels will be similar to previous years fuelling the global production market.
Production levels have now peaked and may fall
Not sure
12 Q. What will happen to the volume of drama production in 2019?TV Industry Trends - 2019 Survey
Drama Production
US Scripted Original Series Volume of Productions Certified for
High-end Tax relief in the UK
200
110 e
103
160
83
120 Broadcast 81*
Basic Cable 58
80 Pay Cable 44
SVOD
40
5
2010 2011 2012 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018
SVOD influence on US scripted series growth is huge. Globally Since 2013 high-end UK TV projects
there is also growth in local originals with Sky, Movistar, Liberty (>£1M p/hr) have been able to apply for
and Nordic Entertainment Group (NENT) all spending more - tax relief, contributing to the rise in the
NENT expecting 15-20 original series per year from 2019. level of production projects.
13 Source: 3Vision market analysis and estimates based on data from FX Networks Research (Dec 2018) and the BFI (Oct 2018)
* Represents certified productions up to and including Sep 27th 2018TV Industry Trends - 2019 Survey
Content Licensing by SVOD
“SVODs will
become more 8% 17% 44% 29%
73%
active in buying
first windows” Believe that SVOD will acquire more first
Strongly Disagree Slightly Disagree
window product in 2019
Neither Agree/Disagree Slightly Agree
Strongly Agree 73% of respondents agree that SVOD will
acquire more first windows in 2019.
Global Distribution of 1st Window Scripted Series In addition to growing production activity, data
from 11 key global markets shows that season-
59% 56%
on-season SVOD is taking a greater share of
65%
first window acquisitions - with many individual
41% 44% territories finding the marketplace even more
35%
dominated by SVOD. In Sweden where SVOD
2016/17 2017/18 2018/19 has had huge success 80% of 2017/18 season
SVOD Free/Pay TV shows went to SVOD in the first window.
14 Source: 3Vision Show Tracker (December 2018)TV Industry Trends - 2019 Survey
Content Licensing by Broadcast Channels
81% 66% “Broadcasters will offer more
in-season stacking and/or
Box Sets with first windows”
7% 10% 47% 34%
There will be more Channels will offer more
stacking and Box Sets on digital exclusively “Broadcasters will release
more content exclusively 8% 20% 56% 10%
online”
There is strong agreement from within the industry
that broadcasters will have more enhanced content Strongly Disagree Slightly Disagree Neither Slightly Agree
Strongly Agree
propositions in 2019.
Selected Examples of Broadcaster Releases in 2018
All 4 (UK) SVT Play (SWE) ABC iView (AUS) Canal+ (FRA) Sky (UK) CMore (Nordics) BBC (UK)
Search Party The Bold Type Killing Eve Hard Sun Get Shorty Sweetbitter Killing Eve
Box Set released Box Set released Box Set released 2 Box Set released Box Set released Box Set released Box Set released
exclusively online exclusively online months pre-linear with linear with linear with linear with linear
15 Source: 3Vision Show Tracker (December 2018)TV Industry Trends - 2019 Survey
Content Licensing by Broadcast Channels - Box Set Examples
Broadcasters are innovating by premiering with Box Sets - with varied examples from the second half of 2018
Market Show Exhibition Lead Service Local Premiere
Castle Rock Pay TV & Box Set 12-Nov-18
Snowfall Pay TV & Box Set 04-Jul-18
FOX Showcase
Succession Pay TV & Box Set 06-Dec-18
Trust Pay TV & Box Set 07-Oct-18
Counterpart Free TV & Box Set 08-Aug-18
Australia
Son, The Free TV & Box Set SBS 07-Aug-18
Waco Free TV & Box Set 15-Nov-18
Orville, The Free TV & Box Set SBS Viceland 24-Sep-18
Deception Free TV & Box Set 22-Aug-18
Seven
Life Sentence Free TV & Box Set 27-Aug-18
My Brilliant Friend Pay TV & Box Set Canal+ 13-Dec-18
France Bisexual, The Pay TV & Box Set Canal+ Series 23-Dec-18
First, The Pay TV & Box Set OCS Max 09-Oct-18
Kidding Pay TV & Box Set 03-Dec-18
Germany Sky Atlantic
Sharp Objects Pay TV & Box Set 30-Aug-18
Italy Mayans MC Pay TV & Box Set FOX 06-Dec-18
Informer Free TV & Box Set 16-Oct-18
BBC One
Killing Eve Free TV & Box Set 15-Sep-18
Trust Free TV & Box Set BBC Two 12-Sep-18
UK Bisexual, The Free TV & Box Set Channel 4 10-Oct-18
Escape at Dannemora Pay TV & Box Set 01-Jan-19
Kidding Pay TV & Box Set Sky Atlantic 29-Nov-18
Succession Pay TV & Box Set 02-Aug-18
16 Source: 3Vision Show Tracker (December 2018)TV Industry Trends - 2019 Survey
Content Licensing
“Broadcasters
will be more open
to buying shows 15% 25% 47% 8%
55%
that have had a
first window on Broadcasters will be more open to 2nd window after SVOD
SVOD”
Strongly Disagree Slightly Disagree
Neither Agree/Disagree Slightly Agree
2nd windows post-SVOD have been one of the issues of
Strongly Agree 2018. With more shows coming back to the market there
have been more efforts to sell these titles. However with
many varied impacts on a show’s prospects (and different
opinions on whether SVOD is Netflix or someone else), it is
increasingly hard to predict the value in some markets.
The majority agree broadcasters will be more open to it, with
more examples in 2018, but clearly the increased utilisation in
the 1st window has an opportunity cost and 2019 will be an
important year in terms of finding some kind of equilibrium.
17 3Vision Trends Survey 2019TV Industry Trends - 2019 Survey
Content Licensing - Second windows following after SVOD
Selected examples of second licensing window deals following an SVOD first window.
Show Ter. 1W 2W Exhibition
American Gods CAN Amazon Prime Super Channel Pay TV (Stacking)
American Gods FRA Amazon Prime Fuse
Canal+ Series Pay TV (Rolling 5)
American Gods GER Amazon Prime RTL Crime Pay TV (Rolling 5)
American Gods ESP Amazon Prime XTRM Pay TV
Blacklist: Redemption SWE Viaplay TV8 Free TV (Rolling 5)
Britannia FRA SFR Play RMC Story Free TV
Handmaid's Tale, The ESP HBO Spain Antena 3 Free TV (7 days)
Handmaid's Tale, The SWE HBO Nordic SVT Free TV (Rolling 5)
Imposters AUS Stan Nine Free TV (Rolling 5)
Kevin Can Wait GER Amazon Prime RTL Nitro Free TV (7 days)
Liar SWE HBO Nordic SVT Free TV (Rolling 5)
Riverdale FRA Netflix Warner TV Pay TV (Rolling 5)
Riverdale UK Netflix 5Star Free TV (Rolling 5)
S.W.A.T. SWE Viaplay TV3 Pay TV (Rolling 5)
Sinner, The SWE Netflix SVT Free TV (Rolling 5)
StartUp UK Amazon Prime Virgin Media Pay TV
Strike Back: Retribution ESP HBO Spain Ultra
XTRM HD Pay TV
Strike Back: Retribution SWE HBO Nordic C More Series Pay TV (Stacking)
Taboo GER Amazon Prime RTL 2 Free TV (7 days)
Taken UK Amazon Prime 5USA Free TV (Rolling 5)
18 Source: 3Vision Show Tracker (December 2018)TV Industry Trends - 2019 Survey
Broadcaster AVOD Services
As advertising revenues have shifted online and Key Drivers for Broadcaster AVOD Growth
stagnated for linear television, commercial
broadcasters are taking a bigger view of Exclusive 30%
Content
advertising video revenues - enhancing their
Content
AVOD platforms to compete for their share of Premieres 20%
all video advertising (online and TV).
In-season 15%
Stacking
Respondents believe that there are multiple
drivers for broadcasters who are looking to find Library 15%
Box-sets
AVOD revenue growth.
Targeted 12%
However it was the content proposition that led, Advertising
with Exclusive Content (30%), followed by
Personalisation 8%
Content Premieres (20%) coming out on top.
% of respondents ranking the feature in the top 2 most important
19 Q. Which of the following features do you believe are most likely to accelerate growth for broadcaster AVOD platforms? (1= most important, 6 = least important)Wrap Up
2018 has seen great evolution with television businesses and the general feedback from respondents reflects that
the industry does not expect this to slow down at all in 2019.
With so many different levers to individual businesses the capacity for innovation and change is huge. SVOD is
no longer marginal to anything or anyone, and increased competition (whether it be for subscribers, viewers or
content) will continue to influence decisions by stakeholders along the value chain.
Although many of these areas do not directly compete (and there doesn’t need to be losers) it is inevitable that
2019 will see casualties - failing SVOD and D2C services are probable, and some high value productions will fail
and scare off some new players. However respondents have been broadly positive about 2019, with no
predictions of doom, and there are plenty of upcoming service launches, innovations and new programming to
keep us busy.
We are the content industry insiders.
For over 15 years we have been helping broadcasters and distributors to position their business for success. We combine intelligent trend
analysis and our deep industry experience to give your business expert insight. Our strategic advice is drawn from first-hand experience and
real-world success.
Strategy. Research. Rights negotiation. Business development. If you’re a business with ambition in the content world, 3Vision’s consultancy
services can help.
+44 1225 636 200 contact@3vision.tv www.3vision.tv @3Vision
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