Newsletter 20th of January: Nordic Media Consumers Rely on Subscriptions


20 January 2021

The subscription economy and its rapid growth across several industries is a hot topic. In the media sector, subscription models have been common practice since long. Mediavision’s analysis of the Nordic media market shows that subscriptions now account for the majority of the household’s spend on both media and access (i.e., mobile and broadband).

In recent years, the subscription economy has gained a lot of traction and today consumers can subscribe to almost anything under the sun. The media industry, as we all know, has a long tradition of applying this business model, also in the Nordics.

As a total, a Nordic household spend EUR 150 per month on media and access. The split between media and access shows a slight overweight for mobile and broadband compared to media services.

Mediavision can conclude that the Nordic media industry is highly subscription driven. In all categories, this is the dominating business model and accounts for most of the households’ monthly media spend.

Within audio, 75% of spend is earmarked for subscriptions, predominantly driven by music streaming services.

The largest share of spend (77%) allocated to subscriptions is found within video. Video subscriptions (both for pay TV and SVOD) have since long constituted a large share of household spend and have remained strong during this pandemic-influenced period. Comparably, cinema (a share of the single purchases within video) has suffered significantly. Soon, we will dive deeper into the consequences for cinemas during 2020.

Text stands out in this comparison. Single purchases account for 46% of the total spend within this category, mainly explained by tabloids, magazines and printed books. However, Mediavision predicts that this share will decrease going forward, as consumers increasingly move towards subscriptions also for text.

In conclusion, Mediavision’s outlook for 2021 is that the importance of consumer revenues will increase even further, as the media industry aims to mitigate the weakened advertising market. By that, the subscription model will continue to gain ground.

Industry News

Netflix Surpasses 200 million Subs

In it’s Q4 earnings report, Netflix announced that the service now boasts more than 200 million subs globally, after adding 8.5 million in Q4. Netflix also expects to soon become free cash flow positive. The stock rose 12% in after hours trading.

Swedish 5G Auction Concluded

On Tuesday, the Swedish 5G auction was concluded. The permits were won by four actors; Hi3G Access (Tre), Net4Mobility (Tele2 och Telenor), Telia Sverige and Teracom. In total , the auction amounted to 2,3 billion.

Apple Mulling Podcast Subscription Push

Reportedly, Apple has been engaged in talks to introduce a podcast subscription service since at least last fall – allegedly pushed by Spotify’s recent endeavours in the podcast market, in addition to the recent amped up focus on services from Apple.

Radio Loud Joins Danish Podcast Index

Danish actor Radio Loud has declared a strong focus on podcasts. Now, the actor will join the Danish Podcast Index – with the ambition to get 10 podcasts into the top 50 within the next year. The Danish Podcast Index is administrated by Danske Medier Research.

Apple Extends Apple TV+ Trial

At the launch of Apple TV+ in Nov 2019, the company offered a free
12-month subscription with purchases of devices incl. iPhones, Mac computers and Apple TV. Reportedly, these will now be extended until the end of July – the second extension made to the free trial period.

Netflix Leads Critics Choice Association Noms

Netflix received the most nominations for the Critics Choice Association awards, in total 26, partly driven by original Netflix dramas “The Crown” and “Ozark” both landing six each, including “Best drama”. HBO landed the second most, with 22 nominations.