Newsletter December 19: Holiday wishes and predictions for the new year

19 December 2018

With an eventful year behind us we’d like to wish all our readers a very merry Christmas and a happy new year! But before closing for the holidays, we have compiled a list of predictions and trends that might possibly affect the media landscape in the coming year. What does 2019 have in store, according to Mediavision? Let’s take a closer look!

SVOD is cracking thanks to stacking
SVOD is going through the roof in the Nordics, with double digit growth in the past year. And there seems to be no stopping to this development. Growth is predicted to continue in 2019 with Norway and Sweden surpassing the 50% household penetration mark and Finland and Denmark approaching the same level. The appetite for streaming services among consumers is increasing also among subscribers. The number of SVOD subscriptions per household is on the rise, a phenomenon known as “stacking”. With new actors entering the market, and local telco’s boosting their online offerings, we believe that stacking will be a strong force behind growth next year. The launch of Disney+ and Apple’s video streaming service in 2019 will also push this development. We are also likely to see a number of other new streaming services popping up, both in front and behind the telco paywall.

Get your prescriptions for the year of audio subscriptions
In 2019, consumers spend on digital media will enter a new paradigm. Audio will take a larger piece of the digital media pie. Competition on the music streaming market will ramp up. Meanwhile, voice is the choice as more consumers subscribe to audio books, listen to podcasts and utilize their own voices as an interface for media consumption. For example, if we were to sample the growth of video streaming subscriptions at a similarly early stage – digital audio books will be all the rage, in 2019. This would mean that more than a fifth of Nordic households would subscribe to a service for digital audio books in 2019. This is a plausible development, not only due to consumers’ increased appetite for digital media, but thanks to technological advancements in audio and voice-controlled software. Increased penetration of voice-controlled speakers is likely to enhance the growth of audio subscriptions in 2019.

TV advertising at peak, not only ‘cause economy is to be weak(er)
The traditional TV advertising market is facing some challenges in 2019, one of course being the ongoing transformation from broadcast TV to online video. So far, the broadcasters have been quite successful in raising prices to compensate for the viewing drop, thus with a decreasing share of the total advertising market. The economy in the Nordic region shows early signs of slowdown and 2019 may be the starting point of slackening advertising budgets. This in turn will likely have a negative effect on the TV market. Mediavision believes that supply and demand in broadcast are close to balance, hence there will be little room for continued price increases. Looking at Sweden specifically, the 2019 re-regulation of the gambling market is also likely to have an impact on the traditional TV advertising market. In Q3 2018, offshore gambling actors accounted for well above 20% of Discovery and NENT groups ad inventory respectively. With the new regulation, it’s probable that (for example) tech giants as Google or Facebook will start to compete over these advertising budgets.

And now for some perhaps less apparent, but still plausible, predictions.

FAANG becomes AANG?
Facebook stock dropping, while Amazon globally plough. Five major tech giants become four, Amazon prevails and Facebook is no more. Facebook’s stock has plunged 40% from recent peaks this year, while Amazon’s stock is up 40% this year. Acquisition to be seen among the renowned tech giants, as Facebooks continuous decline in price per share puts the social media platform up for sale.

Chinese music to dominate streaming – also in the Nordics?
Tencent gazes towards the Nordics and Spotify. A spot-on complement for Tencent Music, perhaps. Tencent already has a minority stake in Spotify.

Diverging video trends (traditional pay market consolidates, digital market fragmentates)?
Traditional media companies for survival merge; package bundling and content converge. Digital streaming services instead see fragmentation; amped up focus on original productions, along with new service introductions.

From all of us at Mediavision to all of you, a very merry Christmas! We’ll be back in full force in January, until then, happy holidays!

Mediavision blogs:

The Swedish gambling market: The upcoming re-regulation, part 1
2018 will go down as a very eventful year on the Swedish gambling market. With a new legislation starting Jan 1, 2019, the market will open up for new companies, operating from abroad. A license system will govern both Swedish and off-shore operators, […].

Mediavision press releases:

Increasing number of streaming services in Nordic households
The appetite for streaming services among Nordic consumers continuously rises. Today, 5.3 million Nordic households subscribe to at least one video streaming service (SVOD). Also, the number of SVOD subscriptions per household increases […].

Industry news:

Facebook looks to make a move into TV
Facebook is readying its biggest move into video to tade: It wants to sell consumers subscriptions to cable TV networks like HBO. Facebook is in talks with pay TV channels including HBO, Showtime and Starz.

EU territorial licensing agreement
Industry organizations and and major companies in Europe and Hollywood welcomed on Tuesday a European Union agreement that preserves producers’ ability to sell movies and TV shows on a exclusive territory-by-territory basis.

Spotify share price hits new low
Spotify hit its share price peak in August at $192. Since the 31st of August, Spotifys share price is down 37 percent and hit a new low this Monday. During the same period, the New York Stock Exchange’s FAANG-index is down almost 10 percent.

AT&T launches first US 5G mobile service
AT&T has claimed a first with the launch of a 5G mobile network in the US. The service is initially available in 12 cities using a mobile hotspot device. As no 5G phones are available yet, customers can only use the service for mobile broadband.

€893 million takeover bid for Cherry Casino
Swedish gaming group Cherry is the subject of a €893 million takeover from a consortium that includes Betsson CEO Pontus Lindwall. Cherry’s independent bid committee has recommended shareholders to accept the offer.

Mediavision in the news:

Nordmenn fråtser i strømmetjenester – stadig flere har minst tre abonnement
Norge ligger lengst fremme i Norden når det kommer til såkalt SVOD-stacking, som er en betegnelse på å abonnere på flere strømmeabonnement samtidig.

Allt vanligare att nordiska hushållen har flera streamingtjänster
Betalda streamingtjänster för video, SVOD-tjänster, fortsätter att öka hos de nordiska konsumenterna. I genomsnitt abonnerar 48 procent av hushållen på åtminstone en tjänst […].

Mediavision: 48% of Nordic homes use SVOD
Almost half of all Nordic households now subscribe to at least one subscription video-on-demand service, according to Stockholm-based business development consultants Mediavision. The report claims that today 5.3 million Nordic homes, some 48% of the region’s total.

Nearly half of all Nordic households are SVOD subscribers
New analysis from Mediavision finds that the takeup of SVOD services continues to grow at a rapid rate in the already streaming-heavy Nordic region. On average, 48 percent of all Nordic […].

Kraftig ökning av strömningstjänster
Svenska hushåll som prenumererar på exempelvis Netflix, HBO eller Viaplay blir allt fler. Nu har 2,2 miljoner hushåll en strömningstjänst och antalet som har flera abonnemang ökar. För ett år sedan hade 1,7 miljoner svenska hushåll någon form av […].

Industry events

  • CESJanuary 8-11, Sweden

*Events where Mediavision will be presenting