A new study looking at the implementation of the European Commission’s Audiovisual Media Services directive has revealed that video-on-demand revenues in the European Union are growing, but currently account for less than 1% of total TV revenues.
The report, which covers the period to end-2011 also shows that overall TV sector revenues of about €77 billion have been flat since a similar study in 2008. Ad revenues have decreased and there is a heavier reliance of public funding, while pay TV continues to be the growth driver in the sector, according to the report. It adds that Europe’s five largest TV markets still generate 70% of all revenue and Germany and the UK are by far the largest TV markets. The incumbent channels in the main markets also account for over 90% of all commissioning spend although only about 56% of gross industry revenue. Overall programming spend has grown little if at all since 2008, the report says.
The wider economic outlook means the way that content makers operate has changed in recent years. “The global softening of the economy in recent years has affected broadcaster margins with a knock-on effect on the independent production sector,” the report authors note. “Independent producers have become increasingly reliant on secondary and ancillary revenues to drive profits, with commission spending by broadcasters generally only covering the production cost for the producer.”
Separately, the European Commission is to launch a public consultation on connected TV, EC vice-president and digital agenda commissioner Neelie Kroes (pictured) has said.
Presenting the new report on the application of the directive, which pointed to the need for further EC guidance on internet-connected TV, Kroes said that the Commission would launch a public consultation in the second half of this year.
Kroes revealed at the Cable Congress event in Brussels earlier this year that the EC would publish a policy paper on connected TV. The EC will also update its guidance on TV advertising next year.