An increasing share of video on demand and online video and TV blending may be expected as one of the directions of TV broadcasting development.
Payments for TV content viewing will increase in the Czech Republic, and TV and video content will blend at the same time. While TV operators gradually enter the field of video on demand (VOD) and subscription video on demand (SVOD), streaming operators seek to offer linear services. This is one of the observations made in the discussion on the future of TV broadcasting held on Wednesday as part of the Contagious Re-starter conference.
Daniel Grunt, Head of Digital of CME and TV Nova, estimates that at present, about half of the Czech population pays for TV (in addition to the licence fees, i.e. payments to operators for TV programme subscription). He expects that in future, majority of population will pay for TV broadcasting and the difference between linear TV and video on demand or timeshift will fade away. “People will watch what they enjoy. The TV and online worlds are approaching each other and their boundaries will merge,” he said, outlining the development.
Covid-19 accelerated the development of paid market by 2-3 years
The Covid-19 pandemic has driven higher interest in video on demand in the Czech market according to the discussion participants. “It started the development of SVOD as people were not used to paying for content. Every month we can see that on Voyo where the number of subscribers has been increasing,” said Grunt, expecting that the share of VOD and SVOD in the Czech market will keep growing. In his opinion, the pandemic has accelerated the paid video content market by 2-3 years. Linear TV will not dampen although we may expect that its share will not be growing. Tomáš Búřil, Sales Director of Seznam.cz, under which Televize Seznam operates, notices changes in viewers’ needs. “In the morning, they immediately search for news content, they do not wait till the evening. TV will be more passive, but on the other hand, we no longer make any distinction between TV and the internet in Seznam, it is just one video content,” he described.
Seznam.cz wants GRP metrics for online video
Merging TV and online video content is reflected in business as well. Operators strive to provide clients with aggregate reach of video content that is equal to GRP. Seznam.cz wants to go in this direction, following Media Club and Óčko TV Group. “We are close to the combination of GRPs on TV and on the web; some clients have invested more in online video than in TV,” specified Búřil. He is also convinced that the internet market may be twice as large as the TV market in the Czech Republic (annual turnovers of TV operators of about CZK 9 billion, turnover of Seznam.cz of about CZK 5 billion; according to the estimate made by Tomáš Búřil, Seznam’s share in the internet is 30%, Google and Facebook account for 30% each).
CNC prepares a premium product
Juraj Felix, co-CEO of Czech News Center (CNC) and CEO of Mall.TV can also see the trend towards paid content. For CNC, video is one of several channels to address users and create space for advertisers. “CNC has invested much in content creation. In terms of video, the time spent with video is more crucial for us than the number of clicks. We are betting on a smart TV application,” he said. According to him, CNC is testing how to design a premium product that would contain all media types. “We will have a more clear strategy at the end of the year, it will be cross-media and will contain video,” he added.
Voyo will not go against Netflix
With the expected increase in the number of VOD users, segmentation of audiences for various video services should be taken into consideration. For example, Voyo on which Nova’s digital strategy is based targets viewers between 25 and 50 years searching for the Czech original (TV series) programmes. “We are fishing in waters of Czech TV series. SVOD is not for young people, it is no longer true. We will educate older people. It will require more work but the potential is greater because the number of these people is higher,“ he outlined Nova’s plans. According to him, Voyo will not want to compete directly with Netflix whose estimated primary target group is up to 29 years.