Black Nights 2021 - Industry@Tallinn & Baltic Event
Industry Report: Distribution, Exhibition and Streaming
Ampere Analysis’s Rahul Patel talks SVOD's internationalisation of popular TV shows and movies
At TV Beats, the expert delved into the most recent market trends and explained how global streaming platforms are changing consumption and pushing for the production of more non-US content
This year's edition of TV Beats, one of the industry strands of the Tallinn Black Nights Film Festival, was opened by a fresh market report by Rahul Patel, senior analyst at London-based media research and consultancy firm Ampere Analysis. His contribution focused on explaining how SVOD are leading the internationalisation of popular TV shows and movies.
To conduct their research, Ampere experts developed a proprietary popularity metrics: "It essentially allows us to understand what consumers are engaging with the most in this highly competitive content market." In detail, the team tracked the 100 most popular titles each year and noticed that more and more content was produced outside of the USA (from 14% in 2017 to 20% in 2021), and that this trend saw a swift acceleration over the last couple of years.
Next, he spoke about consumers' attitudes towards watching overseas content by surveying regularly 20 of the largest media markets and asking different questions about consumers' viewing habits, content preferences and how often they watch movies and TV shows not produced in their own country. One of the graphs saw Finland, Indonesia, Saudi Arabia, the Netherlands, China and Mexico among the most "internationalised audiences," as over 80% of the respondents answered they watch foreign content "very often" or "sometimes." Meanwhile, the least internationalised markets included Russia, Germany, Italy, Canada, France, Spain, USA, UK, Japan and Australia. These markets are forecast to account for 67% of global pay TV revenues, 71% of OTT subscription revenues and 43% of unique OTT subscriptions by 2022, thus "they have a strong influence on production and what becomes a globally popular hit." Patel noted how these core markets display a significant bias towards locally produced content, but they also have the biggest room for growth for international content. In the period Q3 2019-Q32021, the percentage of respondents watching overseas content increased by 13% in the USA, 12% in the UK, 9% in Australia, 8% in Canada and Germany, 6% in Italy, 5% in Spain and France, alongside a 2% decrease in Japan.
In a dedicated survey conducted during the last quarter, Ampere found out that internationalisation is led, in most of these countries, by consumers who can access foreign content and have at least one SVOD subscription active. Their consumption of international movies and TV shows is at least one third higher than that of users who did not subscribe to any SVOD service. This trend occurs even more visibly with those who have subscribed to multiple services, and in particular with users who have subscribed to three or more platforms. This recent uplift, unsurprisingly, is being mostly driven by Amazon Prime Video and Netflix. Besides, content diversification is something SVOD platforms have been already engaging with. Specifically, the data provided by Patel highlight that the proportion of scripted Netflix originals produced outside of the USA in the period June 2018-June 2021 rose from 39 to 54% in the case of TV shows, and from 16% to 42% in the case of movies. This is happening since SVOD's remit extends over a more international audience compared to pay TV operators, which typically compete in a single market or region and often focus on providing local content. The global forecasts for 2026 indicate that pay TV's revenues will decrease from $189 billion in 2021 to $178, whilst OTT services' ones will grow from $80 billion to $135.
In broader terms, SVOD platforms' international expansion is favouring the implementation of a process wherein they commission local Originals to attract new customers in the expansion markets and they act as a viable buyer of international rights for traditional broadcasters. The titles are then made available internationally, thus easing access to overseas content. Moreover, Patel pointed out that top TV content is diversifying much faster than movies, and in particular Canada, Japan, South Korea, Spain and the UK are emerging as production hubs of globally popular TV shows outside of the USA. Recent titles reflecting this trend include Squid Game, Money Heist, 365 Days and Lupin. "We might expect to see this happening more as more SVOD platforms go global like HBO Max and Paramount+, and they start emulating strategies already deployed by the likes of Netflix, Amazon and Disney+," he concluded.
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