THE CRISIS DOESN’T HURT US. PEOPLE WATCH VOYO MORE OFTEN THAN NETFLIX, SAYS THE CEO OF NOVA
In a crisis, people typically cut back on non-essentials like entertainment. But Nova TV, which resurrected the fading streaming video platform Voyo last year, is not complaining about declining interest. Voyo has already half a million users, and despite the crisis, their numbers continue to grow.
"Now in the spring season, Voyo consumption is approaching fourteen hours per week on one account, which is two hours per day. It shows that when people cut back on leisure activities, they have more time to fill," says Daniel Grunt, who has been running the country's largest commercial broadcaster since the beginning of this year.
What you can read in the interview:
- Why isn't Nova worried about the loss of money from TV advertising?
- How did the Ordinace v růžové zahradě 2 series contribute to Voyo's reboot?
- Why is Nova betting on its own series for a more demanding audience?
- Why are Czech TV shows also available on Voyo?
- How does Daniel Grunt rate Rey Koranteng's performance in the presidential election debates?
What does your appointment to the head of Nova mean? You've led various digital projects for a long time. So is this a signal that digital is now playing a major role at Nova and that your streaming platform Voyo will be the main one to develop?
I wouldn't say that Nova wants to fundamentally shift its priorities towards digital. It has to do with the way the growth of streaming services has accelerated over the last three years, kick-started by covid. People spend a not inconsiderable amount of time watching them.
But we can't just push digital. Traditional TV still feeds us and brings us a large part of our income. That should be true for the next five or seven years. But the growth of digital services cannot be ignored. We have caught momentum in this sector and it is good to build on it.
In the world of paper media, advertising revenues are falling. Is it the same for TV? Then a move towards streaming would make sense.
We don't feel that TV advertising is declining. Nova's advertising revenue has been growing steadily over the last few years. Last year, the Czech streaming market was about CZK 3.5 billion in size. In five years it could be double that. This is a fairly significant source of new money that we want to tap into.
Last year, Prima took it upon itself to ban the fast-forwarding of ads on smart TV sets so that it would not lose advertising revenue. It already had a Don't Fast-forward campaign before that, urging people not to deprive it of advertising money. You didn't. Why didn't you?
Prima was in a slightly different situation because it's 100% sold out.
What does that mean?
The amount of advertising space it can sell is completely sold out. At the same time, they're seeing more and more people fast-forwarding the ad breaks. In that context, I understand what Prima did. But it doesn't bother us because we keep our ad space sell-out rate around 75 percent. It's a deliberate strategy to balance the viewer experience with advertising revenue. The longer and more packed your ad breaks are, the more annoyed people get and don't last as long.
In short, you have shorter commercial breaks so people don't fast-forward as much.
Back to Voyo. Why was it important for Nova to kick-start this platform two years ago, which had been languishing for ten years? You could have said there's no point in catching up with Netflix or HBO because they'll always have bigger budgets anyway, and bet on an older audience that's loyal to classic terrestrial broadcasting.
Over the last two years, it's proven to make sense. We recently reported that Voyo has over half a million users in the Czech Republic and Slovakia. We are number two behind Netflix in the Czech market and we continue to grow. No one would have expected that two years ago.
We can't go head-to-head against multinational players. We can't spend hundreds of millions of dollars on one series of a show. Our way is to focus on local content. That means we understand the local audience, local traditions and we can tell stories in a way that makes sense to the Czechs. At the same time, we try to make our content in a form that is premium. See what our series like Případ Roubal, Král Šumavy and Iveta look like. These are big, almost cinematic titles that we deploy specifically for Voyo.
Voyo grows faster in crisis than last year
What about the economic crisis? Aren't you worried that people will start saving money on subscriptions to similar services, which are constantly increasing?
I'm not worried about that regarding Voyo at all. We are trying to operate as a complement to the multinational players. I think foreign platforms like Netflix, HBO, Disney or SkyShowtime may have a problem. People are used to jumping between them depending on what attractive content they are offering at the time. Whereas we are the strongest Czech service, which people probably wouldn't change.
When I look at how long subscribers stay with us, the churn rate is on par with the global Netflix. That's a great result because Netflix has one of the lowest cancellation rates in the industry.
Clearly, when there is a crisis, people cut back on excessive spending. They go to the cinema, concerts or sports matches less. But our subscription for a month is 159 crowns. For that amount, the whole family gets a huge amount of entertainment. Now in the spring season, Voyo consumption is approaching fourteen hours a week on one account, which is two hours a day. It shows that when people cut back on leisure activities, they have more time they want to fill somehow. Think back to the covid period. There was uncertainty then too, but streaming services accelerated in the Czech Republic. Of course, we also have a scenario that foresees shrinking demand. Then we can delay the launch of the planned content a bit and wait for better times. But I don't think that will be necessary.
We're looking not only at how long people spend on Voyo, but also how often they come back. The more often a platform is used, the less risk of churn.
More for Deník N subscribers.