For all the recent talk of Netflix under delivering, Disney performing better than expected, and WarnerMedia on the verge of its megamerger with Discovery, it would be easy to forget that there’s more to the competitive SVOD market than the businesses of major US players.
Truthfully, it is impossible to ignore the size, scale and reach of these operators, but a milestone reached by Nordic Entertainment (NENT) Group’s Viaplay this week is a European success story, albeit one on a smaller scale.
NENT this week revealed that Viaplay, its region-dominating streaming service, has surpassed 4 million subscribers, adding 397,000 subscribers in Q4 2021 to take it to a total of 4.01 million. This is up from 3.02 million year-over-year.
While still a relative minnow, NENT’s sensible approach to expansion combined with a dominant portfolio of rights and content gives the company a stable foundation from which to execute its strategy.
The Nordic way
While it has been dominant in its native Scandinavia, NENT has taken a measured approach to expansion, albeit one which ramped up significantly in 2021.
After outlining its plans in late 2020, Viaplay expanded to a number of new markets in 2021. First of these was the Baltics, launching in Estonia, Latvia and Lithuania in March. This was followed by the expansion into Poland in August and the US in December.
Looking ahead, the streamer will make its long awaited debut in the Netherlands in the coming months, with a subsequent launch in the UK. This will be followed by launches in Canada, Germany, Austria and Switzerland by the end of 2023.
All of this gives NENT CEO Anders Jensen confidence that it will reach 6.5 million in 2022. Writing in his investors note this week, the 52 year old CEO said: “2022 has started well and we expect the Viaplay subscriber and revenue growth to accelerate further this year as planned, as we add very attractive new content and sports rights, and launch Viaplay in the Netherlands and the UK.”
This is buoyed by some staggering viewership numbers, with Viaplay customers streaming a total of 13.4 billion minutes of content in the year.
The company has made no secret to its successful formula: content.
A diverse strategy
It is an oft stated refrain in our industry that ‘content is king’, but while it is something of a cliche that doesn’t mean it is not true.
Speaking with Digital TV Europe in late 2021, NENT’s chief content officer Filippa Wallestam gave an outline of the company’s content-first approach to expansion where it focuses on the desires of target markets rather than trying to make the audience mould to its shape.
For example, the nature of a brand like Disney means that people will gravitate towards Disney+ due to the strength of its IP alone. NENT however does not have the strength of brand recognition, and thus has to take a different tact.
This presents itself as a combination of sports rights – long a strength of Viaplay in its native markets – combined with the typical Nordic fare of dramas and a strong focus on local content “but with a Viaplay Angle.”
Sports is a key aspect of Viaplay’s business at home and abroad, with the company possessing key rights such as the UEFA Champions League and German Bundesliga (which has gained increased attention in the region in recent years due to the emergence of Borussia Dortmund’s Norwegian superstar Erling Braut Haaland).
Expansion however is less determined by the sports rights, with the US launch representing a different approach for NENT. In the US, NENT took a specific approach which differed to its previous model.
Ahead of the launch, Wallestam explained: “The US however is a completely different ball game. We’re not going to have any sports and we’re not going to have a lot of content from the US studios either. There we are going with a very Nordic-focused product, almost like the best of Nordics. This means that it’s our own shows for sure, but also a lot of Nordic shows from other local players – especially the pubcasters in the region.”
She jokingly described the US product as “like BritBox with Nordic content… a NordBox,” and this is the model it is going to take into the UK, while it will offer sports in the Netherlands.
This flexible approach is one which presents a rounded business model for NENT to create a lucrative product and solid strategy. A model which aspiring smaller operators in Europe may be wise to follow.
Furthering this will be the imminent release of NENT’s five-year sustainability strategy, roadmap and targets, explained by Jensen as fulfilling the company’s ambition of “becoming the most diverse and inclusive entertainment company.”
While it would take a dramatic turn of events for Viaplay to expand to the size of a Netflix or Disney+, NENT’s realistic ambition combined with its slow-and-steady approach to expansion has created a template for European operators in the streaming age and proof that you don’t need to be the biggest or most brash to do well in the market.