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Can national identity withstand the global SVOD assault?

Danish TV consumption traditional versus streaming

National broadcasters are losing their voice with the youngest citizens of their country. The young are migrating online and adopting global SVOD services. Could this lead to a national identity crisis?

Regional broadcasters are worried

The BBC has been working hard to attract the burgeoning online video audience. As the iPlayer closes in on its tenth birthday, it is facing slowing growth and struggling to keep pace with Netflix. iPlayer and Netflix are both used by 13% of the British audience. Among the 16-34-year-olds, however, Netflix is well ahead of iPlayer. The trend is highlighted by the fact that the average age of a BBC viewer has crept above 60.

This is particularly galling as the corporation recently took BBC 3 off the air, and moved it to be exclusively delivered online. The BBC did this in an attempt to recapture the young as they migrate their viewing online.

Little wonder that the BBC Director General is talking about reinventing the corporation for the next generation. Broadcasters across Europe face the same challenge. And their greatest fear is that this could lead to a loss of national identity. Without a voice among the youngest citizens of the country, national values and traditions could be replaced by those portrayed by the global SVOD services like Netflix and Amazon video.

Thinkbox SVOD usage estimates realityPapering over the cracks

Some try to assuage the angst of the national broadcasters with seemingly solid facts. For example, in Thinkbox’s recent A Year in TV 2016 report, the UK company reports that ad executives’ beliefs about the market are wildly out of step with reality. For example, the company says “ad” people estimate that “normal” people watch subscription VOD for 1 hour 24 minutes per day. The Thinkbox report goes on to say that “actual” data from comScore/Touchpoints puts the number at just 11 minutes per day.

But looking only at the average user hides the fact that SVOD users are replacing large chunks of TV viewing with their favorite online service. Netflix says that average day usage per subscriber is 1 hour 25 minutes. Roku numbers suggest its users are watching 1 hour and 45 minutes per day. The young are among the heaviest users of these services and devices.

A time to react

For many there is no time left to wait and see what happens. Consider the predicament of Denmark’s largest broadcaster, TV2. Linear TV consumption has plummeted since 2014, from 81% of total TV viewing time to 64% in 2017. At the same time, online TV viewing has exploded, growing from 19% of viewing time to 36%. Nearly 7 in 10 Danes now use streaming video services.*

TV2, the best-known broadcaster in the country, made the decision to launch online services in 2012. TV2 Play brings together all 6 of the company’s broadcast channels with a large library of on-demand content. The newly launched interface on Apple TV provides a traditional guide, restart services, and an easy to navigate on-demand guide. This rich set of content brings access to news, local and international sports, drama, reality, and much more.

Danish customers can subscribe to linear and on-demand content for $16 a month, or just access the on-demand library for $9.

44% of 18-29-year-old Danes are cord-cutters. However, as they abandon traditional pay TV, they have a place to go to continue to enjoy local content. And it looks like the approach is working. Over 300,000 homes, a 13% penetration, have subscribed to TV2 Play.

TV2 still has a long way to go to catch up with Netflix, which has a 37% household penetration in Denmark. But one thing is certain: it will continue to innovate its service to find ways to compete. Nothing less than the Danish national identity is at stake.

Why it matters

Regional broadcasters are seeing their younger viewers quit the traditional television market.

These young viewers are increasingly going to global online services like Netflix and Amazon video for their TV content.

This could put national identity at risk, as the young are continually exposed to different cultural values than their home.

*From a Wilke presentation at the Copenhagen Future TV Conference 2016.

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