In this interview with the CEO of Future TV Conference, Claus Bülow Christensen, we discuss the impact of Netflix on Denmark’s television industry. We discuss how Danes are watching television differently, what broadcasters are doing to cope, and the economic and social issues the changes are causing.
Chapter 1: Netflix not taken seriously at first (0:20)
When Netflix first entered the Danish market, its library was quite limited in comparison with the U.S. version of the service. As a result, the television industry did not take the service seriously. That changed when the company released the first season of House of Cards. The show proved that the service could create high-quality entertainment and deliver it with television quality picture.
Today, Netflix has a 40% penetration. HBO, which released a Nordic service at the same time as Netflix, had some early problems. However, it has recovered from those issues and now has a penetration of 15%.
Chapter 2: Impact on television (2:20)
Mr. Christensen says that Netflix has had an enormous impact on television in Denmark. For example, local broadcasters used to license American TV shows to help attract Danish audiences. Now, most of that content appears on Netflix, and local broadcasters have had to increase local production to compensate.
Chapter 3: Linear viewing falling fast (3:20)
Netflix has also set the bar high for what it means to deliver online. Such a high standard has forced local broadcasters to respond. TV2, a Danish commercial broadcaster that is owned by the State, released an SVOD plus linear TV service akin to CBS All Access that is very popular with consumers.
Chapter 4: Netflix ignites a cultural war (5:00)
One of the biggest problems for smaller countries like Denmark is that young people are spending much of their viewing time with US-based services like Netflix. That means they miss out on much of the Danish cultural and regional issues they would ordinarily see. As well, the success of American SVOD services has resulted in a large amount of television revenue transferring from local businesses to the U.S. Mr. Christensen says that 15% o Danish TV revenue has been diverted to two U.S. based services: Netflix and HBO.