TV Europe MIPCOM 2019

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TVEUROPE

WWW.TVEUROPE.WS

OCTOBER 2019

MIPCOM EDITION

TF1’s Gilles Pélisson / Streaming Wars

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CONTENTS

Drama Galore

INTERVIEW

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TF1’s Gilles Pélisson

The drama we’ve witnessed in Europe this summer did not come from a breakout scripted series. It was televised live, which made it all the more riveting, but it was the real-life proceedings from the British Parliament.

Ricardo Seguin Guise Publisher Anna Carugati Group Editorial Director Mansha Daswani Editor Kristin Brzoznowski Executive Editor Chelsea Regan Alison Skilton Associate Editors David Diehl Production & Design Director Phyllis Q. Busell Art Director Simon Weaver Online Director Dana Mattison Senior Sales & Marketing Manager Genovick Acevedo Sales & Marketing Coordinator Andrea Moreno Business Affairs Manager

Ricardo Seguin Guise President Anna Carugati Executive VP Mansha Daswani Associate Publisher & VP of Strategic Development TV Europe ©2019 WSN INC. 1123 Broadway, #1207 New York, NY 10010 Phone: (212) 924-7620 Fax: (212) 924-6940 Website: www.tveurope.ws

Call it The Boris Johnson Show, rife with deceptions, defections and shifting alliances worthy of Game of Thrones. And this promises to be a long-running series indeed as the Brexit endgame is anyone’s guess at this point.

A perhaps more hopeful drama played out in Italy with the ouster of anti-immigrant, anti-EU, anti-decorum Matteo Salvini. Of course, this being Italy, the fledgling coalition’s chances of longevity are severely limited. And Salvini is sure to seek a comeback and revenge. This is another longrunning drama whose end has yet to be written.

The media industry in Europe is also in the throes of dramatic change. Vivendi, a shareholder in Mediaset, wants to prevent the Italian media group from joining with sister Mediaset España to form a new company, Media for Europe.

The motivation for the merger is to bulk up content and financial resources to better compete with the FAANGs. Fighting the FAANGs could be the name of a long-running drama series starring all the leading European broadcast groups. As our feature details, several markets have launched or are planning streaming or hybrid linear-channel/streaming services. In France, the major broadcasters have Salto on the table. In the U.K., BBC and ITV are working on BritBox. In Germany, ProSiebenSat.1 Media and Discovery, Inc. have launched Joyn. In Scandinavia, Viaplay is seeing original productions boost subscriber counts. In the Netherlands and Spain, broadcast and media groups have also joined forces to launch streaming services.

European broadcasters have had to change how they see themselves and how they plan for a future full of unknowns.

Once transmitters of a mix of entertainment, news and sports to the widest possible audience, broadcasters now have to follow viewers on multiple screens. They have expanded into production and owning rights to shows that they can then monetize across their own and third-party outlets.

Broadcasters have also been buying up popular websites to better serve viewers and advertisers who want to be online.

Gilles Pélisson, for example, has led the TF1 Group into production and the establishment of a digital businesses division.

Viewers will ultimately write the final act of the ongoing drama against the FAANGs. In play will be how much they will be willing to pay and which streaming services they will choose.

—Anna Carugati

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Beginning with its acquisition of Newen, TF1 Group has continued to expand its footprint of production companies in Europe and, most recently, in Canada.

Gilles Pélisson, chairman and CEO of the TF1 Group, talks about how the company is well positioned to grow and compete in an ever-evolving media landscape.

FEATURE 12 POWER PLAYS

A look at how Europe’s most prominent broadcasting groups are taking on the threat from well-funded global streamers.

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Toy Boy

Atresmedia Televisión Toy Boy / Presumed Guilty / The Secret of Old Bridge A thriller laced with luxury, power and eroticism, Toy Boy is part of Atresmedia Televisión’s “Series Atresmedia” offering. The story centers on a stripper who wakes up on a boat in the middle of the ocean with the beheaded body of their lover’s husband on deck. Also part of the Series Atresmedia slate is Presumed Guilty, which allows the audience to try to solve the mystery behind a woman’s disappearance alongside her boyfriend who is seeking the truth. The company is also presenting the telenovela The Secret of Old Bridge, which has more than 2,000 episodes.

“It is a confirmed success in Spain, Italy and Eastern Europe,” says Diana Borbón, sales manager at Atresmedia Televisión. She adds that each of these titles has three essential elements: “sympathy, suspense and surprise.”

“Series Atresmedia is a leader in Spanish fiction going global.”

—Diana Borbón

Audiovisual from Spain Dangerous Moms / Toy Boy / Masai Mara. Battle for Life More than 30 exhibitors are heading to MIPCOM under the Audiovisual from Spain banner, with hundreds of new hours of series, movies, entertainment formats, animated programs, documentaries and various TV services to offer.

Among the main Spanish titles for the market is Dangerous Moms, one of the first series sold by Mediterráneo Audiovisual, the newly integrated sales and production operation of Mediaset España. Another brand-new title is Toy Boy, produced by Plano a Plano and distributed by Atresmedia Televisión. Regarding documentaries, Wild Stories is presenting the 4K doc Masai Mara. Battle for Life.

“Buyers are convinced of the ability of Spanish content to attract audiences,” says Pablo Conde, cultural industries director at ICEX Spain Trade & Investment.

Dangerous Moms

“Spanish fiction and drama series are really hot properties now because they have proven the undeniable talent and expertise of our scriptwriters and producers.”

—Pablo Conde

Water Mirror

Eccho Rights Heart & Soul / Honour / Water Mirror On the heels of signing a deal with SIC, Eccho Rights is bringing to MIPCOM the Portuguese broadcaster’s ongoing drama Heart & Soul, which is about a mother’s attempt to return to her old life 20 years after being forced to abandon her daughter. Also from SIC, Water Mirror is a series about a woman who embarks on a journey to uncover the truth about a past she doesn’t remember. In the Swedish crime thriller Honour, lawyers who usually represent the victims find themselves defending a murderer to save their own skin. Fredrik af Malmborg, Eccho Rights’ managing director, says, “Visually, the show is more colorful than we are used to from Scandinavian drama, and there is humor among serious contemporary topics that are easily relatable for audiences.”

“We are proud to have the chance to work with producers from a wide range of countries.”

—Fredrik af Malmborg

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The Mediapro Studio The Head / The Paradise / The Dinner of a Lifetime The Head, a thriller from The Mediapro Studio set in Antarctica, explores the dark sides of people’s personalities that confinement and isolation bring to light. Produced in association with Hulu Japan and HBO Asia, the series boasts an international cast. Also on the slate is The Paradise, billed as the first co-production between Spain and Finland.

The series follows as police from both countries have to work together to solve a murder case that is terrifying the Finnish community that lives in Costa del Sol. The Dinner of a Lifetime, meanwhile, sees the three-Michelin-starred chef Quique Dacosta honor his guests with an extraordinary food experience inspired by their lives. The guests include six celebrities, among them Spanish Grammy-winning singer Alejandro Sanz.

The Paradise

Enrico Piaggio

Rai Com Il Commissario Ricciardi / Enrico Piaggio / Meraviglie 2 Based on the successful novels by Maurizio de Giovanni, Il Commissario Ricciardi is a lead project that Rai Com will be speaking to buyers about. It is set in the 1930s on the streets of Naples, where a young detective refuses to leave a case unsolved. Thanks to a special gift, he can see the ghosts of those who have been murdered and hear their last thoughts.

David Bogi, the head of international distribution and business development at Rai Com, says the show is a combination of the crime, mystery and supernatural genres “for a solid and engaging story.” The story of the man who gave rise to the famed Vespa scooter is explored in the movie Enrico Piaggio.

The slate is capped off by Meraviglie 2. “The international version is already distributed in over 40 countries, and it finally has a second season with six further episodes,” says Bogi.

“We focus on having a diversity of genres that have broad international appeal.”

—David Bogi

RTVE Malaka / Promises of Sand / Central Market Malaka, a crime thriller from RTVE, centers on two events: the disappearance of the daughter of a prominent entrepreneur and the emergence of a new drug that threatens to upset the existing balance between two rival gangs. Meanwhile, Promises of Sand sees the protagonist, a naïve volunteer at an NGO in Libya, discover the dark side of humanity in a refugee camp where not everyone’s intentions are pure.

Rounding out RTVE’s slate is Central Market, which offers “a slice of life itself, seen through the personal, romantic and working relationships between the people who live and work in a market in a major city,” says María-Jesus Pérez, RTVE’s international sales director. All of these titles, she says, “speak about real people and universal feelings that touch all of us.”

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Malaka

“Malaka is, first and foremost, the story of its characters—sometimes contradictory, sometimes sincere, with both good and bad sides.”

—María-Jesus Pérez

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Gilles Pélisson

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TF1 Group T

F1 remains the leading commercial broadcast group in France, but as with its counterparts elsewhere in the world, content production and ownership have become paramount. Beginning with its acquisition of Newen, TF1 Group has expanded its footprint of production companies in Europe and, most recently, in Canada. Gilles Pélisson, chairman and CEO of TF1 Group, tells TV Europe about how the company is well positioned to grow and compete in an ever-changing media landscape.

TV EUROPE: What programming strategies have led to TF1’s strong performance?

PÉLISSON: We are strong believers, especially as a historical market leader, that content is king and we should provide our audience with unique experiences that we can renew and regenerate through the years. So, we offer a combination of programs that our viewers know and like, which are rendezvous, appointment viewing, and novelties that viewers will discover and [be taken] to different standards in television.

Our ability to program several channels as a group is a plus.

We work on what we call a multichannel strategy, to make sure that each channel brand is well positioned and differentiated from one another. We have TF1, the admiral ship, and then we have TMC, more targeted to young adults. It’s very trendy, a little chic and fairly upscale. TFX is more for millennials and the younger generations and offers reality shows and series targeting that age group. And then TF1 Séries Films provides reruns of the best of what you may have missed on TF1. And then, of course, we have LCI—La Chaîne Info, an allnews channel, which capitalizes on the fact that TF1’s newscasts, whether at 1 p.m. or 8 p.m., are market leaders. Having an all-news channel complementing this strength is also a big plus for the credibility of our news teams, especially in today’s environment of fake news and social media and everything, which may play against the flow of regular news broadcasts.

So you should look at us as risk-takers, as a group that can anticipate trends and identify new formats. And building on this, we strive to optimize the exposure of those formats and present them to the largest audience possible.

TV EUROPE: Would you give an example of how you have taken a show and given it maximum exposure?

PÉLISSON: This may evolve over time, but let’s take as an example a miniseries. It will first air on MY TF1, our replay platform. And through the agreements we have with some operators, a couple of episodes will be made available in advance to subscribers. Then the miniseries will have its premiere on TF1. It will have a lot of replay on TF1 and MY TF1. Later, it may air on TF1 Séries Films. And we are working on how we can extend the exposure. We are working

with our colleagues and competitors from France Télévisions and M6 on an online service along the lines of Hulu, a French version called Salto. You can imagine that some of our programs will also be played on the Salto platform.

TV EUROPE: What can you tell us about Salto?

PÉLISSON: At this stage, I cannot say much, since the deal recently got authorized. We want to get as many people as we can on board for the pre-opening strategy and hopefully be able to launch in the first quarter of 2020. As you can imagine, we won’t talk about it much before it’s on the air!

TV EUROPE: What can advertisers gain from what TF1 Group offers?

PÉLISSON: First of all, we want to offer the best of French television with the power and diversification of our group. By that, I mean an advertiser’s campaign can get the largest exposure between TF1 and the other channels in the group. And depending on its target audience, an advertiser can address just about every member of the French population. Then it can also diversify its campaign on our digital replay platform, MY TF1, in a safe environment. A lot of advertisers have been very disappointed by their experiences, whether on Facebook or YouTube, [given their concerns with] brand safety. [We can also provide] independent measurement of the audience and the performance of a campaign. Advertisers are much more demanding in today’s world, and we can offer both unique content and a very safe environment. We can provide data and analysis about who is going to watch a program. And advertisers can adapt their campaigns and position them for the attributes of the audience that is going to watch it.

Then, about two years ago, we complemented our linear offerings with the acquisition of a fairly diversified digital group. It has some major verticals which are centered around a major brand called aufeminin, which we bought from Axel Springer. It is the leading portal for women and provides all areas of interest for women. It has been up and running for some 15 years and has a vast audience in France and several other countries in Europe. In addition, we acquired marmiton, the largest cooking site in France. With 17 million app downloads, marmiton offers a large and significant audience for advertisers interested in home cooking and food content. We then acquired Doctissimo from Lagardère. Doctissimo is not only about doctors but also well-being and health-related issues people care about these days. These are a few of the verticals we have, and L’Oréal or LVMH or large consumer-goods companies favor them. They say, We enjoyed being able to advertise with

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By Anna Carugati

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TF1 and Netflix cofinanced the big-budget period drama Le Bazar de la Charité.

your linear TV channels, but you bring us additional opportunities through these digital channels.

TV EUROPE: Is there still a role for U.S. product on TF1’s channels?

PÉLISSON: Yes, very much. The Good Doctor has been performing wonderfully for us, with more than a 45-percent market share among women younger than 50. We had up to 7.9 million viewers, which for France, with a population of 66 million, is amazing. Lethal Weapon is still doing well. Manifest did very well last year. We are in the second season of S.W.A.T. Then we did the miniseries The Truth About the Harry Quebert Affair, which was the adaptation of a best seller about an American professor on the East Coast. We have bought New Amsterdam, and the new season of The Good Doctor will be on air soon.

Hospital dramas are still working very well. I would say it’s true that U.S. series are maybe less powerful than they used to be, but the few that we have been able to keep and nurture are doing very well for us.

TV EUROPE: Newen has been broadening its footprint.

What has been the strategy behind the investments in these production companies?

PÉLISSON: Today, owning a studio and production house makes a lot of sense, especially at a time when all over the world, and this is thanks to Netflix, people are more and more used to watching content that didn’t originate in their own country. Newen had a strong base in France.

They produce a lot of original content for Canal+, France Télévisions, M6 and ARTE. First of all, we managed to make them work for TF1, too, because we were not a very big client of theirs. Now Newen is producing a daily soap for TF1 that airs before the 8 o’clock evening news.

And then with Bibiane Godfroid, the CEO of Newen, we embarked on acquisitions throughout Europe. [We bought] Tuvalu in the Netherlands, which has been quite successful with entertainment programming. We bought Nimbus in Denmark, and at the beginning of the year we acquired De Mensen, in Dutch-speaking Belgium, a very successful production house in both fiction and entertainment. They produce Undercover, which is running in France on Canal+, and they are selling it around the world. Over the summer, we announced the acquisition of the studio Reel One, and the deal is under the review of Canadian authorities. It specializes in TV movies, which is a popular genre, with a lot of romance, thrillers and Christmas movies shot mostly in Canada and the U.S. that sell throughout North America and Europe. Major channels in Europe use TV movies, mainly in the afternoon or late morning.

So we felt very good about being able to acquire such a company that will bring an additional highlight to Newen’s catalog.

Jean-Pierre Pernaut, Anne-Claire Coudray and Gilles Bouleau are anchors for TF1’s news broadcast, Le Journal.

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TV EUROPE: How is TF1 Group working with Netflix? On the other hand, are international streaming platforms disrupting the French market?

PÉLISSON: I always say with the American platforms, and especially Netflix, it’s a combination of mixed feelings. On the one hand, it can be our worst enemy, and sometimes Netflix likes to say they are here to replace television. On the other hand, the way Netflix [has generated interest in] international content and non-domestic content is exceptional. When I wear my producer hat, I see tremendous opportunity to export our content. You should always look at it both ways. So the way we see it from the broadcasting standpoint is, How can we cooperate with platforms?

How can we produce or co-produce content in a win-win way, whereby they will provide some investment costs?

Le Bazar de la Charité is an example. TF1 will premiere the show, and it will go to Netflix after

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it has been on our replay platform for the whole linear broadcast period. As this is a fast-changing world, the relationship with Netflix is also evolving. [Netflix was] a dominant player that a few years ago may have wanted to buy everything with unlimited constraints on rights, either wanting rights for the whole world or for an unlimited amount of time, and so on. [But more recently] Netflix negotiated with us and got Le Bazar de la Charité for four years. We are seeing some more rational behavior as competition is coming up and the world is changing. We also have alternative buyers for our product as a producer. It’s good for TF1 as a channel to be able to partner on such deals because it lowers the cost of our production. As a producer, Newen has been able to produce with Netflix in the Netherlands through Tuvalu. We have been able to produce for Amazon. And we see some shows, like The Mantis [La Mante], starring Carole Bouquet, a former James Bond girl, running on TF1 first as a miniseries and then having international exposure on Netflix. So it is a new evolving model, but a very interesting model.

TV EUROPE: French broadcasters are required to invest in programming and film, and as French companies, they are required to pay taxes. Do you feel international platforms present in France should have the same obligations?

PÉLISSON: Yes, we do. It’s the whole idea about GAFA [Google, Amazon, Facebook, Apple] being taxed on turnover in France, and not necessarily just an optimized corporation tax. In most countries in Europe, the two dominant players, Facebook and YouTube, capture close to 100 percent of the growth in digital advertising budgets, while most of the local digital players are limited to a very tiny piece of the pie. We believe it is time for

the government to enforce some participation and tax contribution [on digital companies] so that there is financing for local content. The whole idea is to have a more balanced game between the domestic players, who are under such historical obligations of financing content, and the new players, who use content in a publisher or an aggregator model. Even though they are not based in France, these digital companies should also participate, since they have millions of subscribers in the country and are taking a large share of the consumer’s attention and data. As Netflix is not participating in the funding of local French content, when a French consumer subscribes to Netflix, his payment doesn’t contribute to the funding of local French content.

TV EUROPE: In what areas of the group do you see prospects for growth in the next 12 to 24 months?

PÉLISSON: The way we are positioned, I like to say, as in the America’s Cup, we have moved from a 12-meter monohull sailboat to a trimaran flying over the water. They go faster and take the wind much better, however little wind there is. We have diversified our group, in one direction into production and content with Newen, and in another toward the digital world for the advertisers. [We have a better] one-to-one connection with each individual and consumer compared to what we used to be, which was a mass medium. This has transformed the group in a more balanced way and made it more capable of facing competition and challenges in the future. We have seen this recently with MY TF1, which has been completely revamped as a platform. We can now address each consumer, and not just millions of consumers, as we used to think in the television world.

Newen produces the daily soap Demain nous appartient for TF1 and has been selling the show internationally as Tomorrow Is Ours.

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BBC Studios’ Gentleman Jack.

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POWER

PLAYS

Jay Stuart finds out how Europe’s most prominent broadcasting groups are taking on the threat from well-funded global streamers.

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he impact of the FAANGs is so enormous, you only need A for Amazon and N for Netflix to spell trouble for leading European broadcasting companies, no matter what language they speak.

In France this summer, Canal+ Group laid off about 500 employees (18 percent of the local staff) in the face of the OTT challenge. Maxime Saada, chairman of Canal+ Group, in informing employees of the job cuts, noted, “Despite the commercial repositioning with an offer at €20, we have not succeeded in stemming the fall in results.”

Just a few months later, in September, Canal+ announced a partnership with the streamer. Subscribers to the Cine/Series package will have access to the Canal+ premium channel as well as the Netflix service, all under one subscription. “This offer complements our all-round offer of first-run movies, major live sports events, world-class series, including our Créations Originales,” Saada said at the time. “It also helps us further consolidate our position as a key aggregator of content and services.”

In the U.K., Netflix is on its way to passing the combined number of Sky direct-to-home and OTT subscribers in 2019, according to Kagan’s S&P Global Market Intelligence.

Meanwhile, Sky’s new owner, Comcast Corporation, has indicated that it plans to launch another global OTT competitor, a worldwide version of Sky’s NOW TV, in 2020.

Netflix and Amazon have brought two massive new realities into the market: a tier of OTT with the scale to produce a large volume of original content that can compete directly with established broadcasters, and a geographical spread way beyond national boundaries.

Now, broadcasters in France, the U.K. and Germany are forming alliances to create their own domestic OTT platforms.

“The broadcast and pay-TV industry is way behind and needs to play frantic catch-up,” says Ed Barton, chief analyst for the entertainment practice at Ovum. “They tried skinny SVOD bundles as their first counterattack with limited results. Their new hybrid platforms are the second effort. They need them to work.”

The new hybrid model has evolved from SVOD. Broadcasters have seen that they can add AVOD with lots of opportunity for cross-marketing and upselling.

“We’re getting close to the last-chance saloon in OTT,” Barton notes. “If the hybrid approach doesn’t work, distributors with content might just say, Put it all on Netflix and forget it.”

The rationale behind the hybrid model is to offer a national alternative to the global giants and expand the range of the

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Sky’s stand-alone NOW TV service delivers box sets of shows like Fortitude.

OTT content offer while extending powerful domestic broadcaster brands, and their advertising reach, into the digital space.

Perhaps the most eagerly awaited new OTT project is Salto in France, a joint venture of public broadcaster France Télévisions and commercial networks TF1 and M6. An SVOD offering, Salto will sit alongside the partners’ own digital services, offering exclusive premieres of content as well as original shows.

As Delphine Ernotte Cunci, the CEO of France Télévisions, has described it, “Salto will be able to respond to the challenge of global platforms by offering a high-quality service to all our audiences and showcasing the best of the French and European creative industries.”

Salto has been slow to get off the ground. Announced a year ago, the project has been bogged down by intense regulatory scrutiny. In March, after a six-month delay, the European Commission sent it back to French regulators for a decision. In August, Salto finally received the green light, with the launch slated for 2020.

Significantly, the Salto project has not prevented TF1 from partnering with Netflix to pre-finance a big eight-part drama, Le Bazar de la Charité.

“Broadcasting is highly regulated, OTT is not,” observes Peter MacAvock, the head of distribution, platforms and services for the European Broadcasting Union and chairman of the steering board of the DVB Project. “People might think any regulatory advantage for broadcasters in OTT might be about putting limits on the likes of Netflix, but it’s just the opposite. It’s about freeing the broadcasters up. We need to update the regulatory regime for OTT. Ironically it has been easier for European broadcasters to go into a venture for the global market rather than in their own countries.”

BRITISH UNITY BritBox, a partnership of ITV and BBC, is scheduled to launch in the U.K. before the end of 2019 (a decade after regulators blocked a project for BBC, ITV and Channel 4 to create a joint streaming service). An SVOD platform, BritBox will provide British content in three ways: the partners will put their archives on BritBox, they will put

their new shows on once they have been broadcast and available on their respective catch-up platforms, and they will create original BritBox content.

“Our instinct and research among consumers show there is an appetite for a distinctly British OTT,” says Paul Moore, group corporate affairs and communications director at ITV. “We’re talking about something complementary and in addition to the existing OTT offer. We recognize that streaming has opened up a new way to access content for a relatively low amount and that consumers want to watch what they want, when they want.

What does not exist is something distinctively British.

We love American content. But we like our own, too.”

BEYOND THE ALGORITHM Curation will play a big part in the BritBox offer. “It’s not just about algorithms,” Moore says. “We will have those, of course.

We have a late-mover advantage in this respect. We will be comparable to Netflix in functionality. But we can offer recommendations that are more authentic and human.”

There are questions about BritBox’s viability in an already crowded landscape. “There is certainly room in the market for new players,” says Courtney Williams, the head of partnerships at Parrot Analytics. “But if you are simply thinking that, Hey, I’ve been making content that has been successful in my market for a long time, so I can compete successfully, that’s not enough. Demand for programming on digital is not the same as viewing preferences for programs on linear, where viewers are already watching TV and have a limited range of choices. It’s not a matter of, Do you prefer white or black? You need to have a color that people actually want.

You are competing with a whole world of options, including doing something else.”

And the “color” OTT customers want is usually original and exclusive.

A new hybrid competitor, Joyn, is already up and running in Germany with original content being produced.

Available since June, Joyn is a 50-50 joint venture between ProSiebenSat.1 Media and Discovery, Inc., with more than 50 free TV channels available as live streams and a media library. Joyn is showing the third season of the hit local series

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Viaplay is on board for a second season of its original series The Lawyer, which is distributed by STUDIOCANAL.

jerks., with exclusive and free access to two episodes well ahead of the TV broadcast.

“What we’ve learned from our users so far is that they are keen on watching local originals,” says Alexandar Vassilev, Joyn CEO and managing director. “The success of jerks., which is one of the most authentic local productions in Germany, convinced us they crave relevant content. So local production will be a strong investment focus for Joyn.”

The dramedy Lice Mother (Die Läusemutter) and originals such as Singles’ Diaries and Technically Single were available at launch. Joyn has a well-filled production pipeline that also includes 23 Morde, Check Check and Frau Jordan stellt gleich.

A Joyn Premium tier is slated for a winter debut.

SCANDI EDGE

ever drama productions and has been a huge hit on Viaplay since premiering in April.

“In the main, we use partnerships to tell the very biggest stories. We work with Atrium TV, a global commissioning club with the potential to become a new model for creating premium drama.”

Atrium TV’s other Western European partners include Deutsche Telekom, BT in the U.K., Orange in France and Movistar+ in Spain.

“We see working together as a way to stay unique,” Mejlhede says. “In Q2 of this year, the number of Viaplay customers increased by 65,000 to represent 60 percent of NENT Group’s total subscriber base. I think the most interesting thing is how much growth is still available. There are around 12 million households in the Nordic region, but only 50 percent subscribe to a streaming service today.”

In the Netherlands, NPO, RTL Nederland and Talpa TV teamed up to launch the OTT platform NLZIET five years ago.

“The business model is straightforward,” says Niels Baas, managing director of the venture. “We collect all the revenues and we distribute money to the partners based on the viewing share of their channel. If public TV has a 30-percent share, they get 30 percent of total revenues. The whole model depends on scale. For it to make sense for a channel, they have to be sure of getting some viewing share. If you are small, you won’t get enough share, so you won’t put your content on.”

Plus, Baas notes, “There’s the brand issue. The Dutch market is so fragmented and competitive, our broadcasters already have a branding challenge. NLZIET actually dilutes their brands more.”

Original content is paramount in the OTT battle, Baas says.

“Having everything from the broadcast channels a year later on an SVOD basis without any advertising is nice, but it’s not

In the cutting-edge digital market of Scandinavia, Nordic Entertainment Group’s (NENT Group) Viaplay is set to premiere 20 new originals every year and is offering 50,000 hours of live sport annually.

“We’re finding that originals are a particularly effective way to establish Viaplay as the preferred local complement to global platforms,” says Jakob Mejlhede Andersen, the CEO of NENT Studios U.K. “In 2018, seven of the ten best performing new series on Viaplay were our own productions, and we’ve sold around half of our originals to broadcasting and streaming partners around the world, which confirms how attractive these stories are. They’re a big reason why Viaplay is already one of Europe’s top five streaming services—and we’re just getting started.”

Mejlhede adds, “We’re very happy to make significant investments in original content when it makes sense. Our original series Wisting with CarrieAnne Moss is one of Norway’s biggest- 23 Morde is an original on Joyn, a joint venture between ProSiebenSat.1 and Discovery.

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Netflix is investing in original content across Europe, including The Crown in the U.K.

strong enough. It’s too much like catch-up. For pure SVOD, you need originals.”

In the grand scheme of things, OTT is not a natural space for broadcasters, whose business for decades has been all about building channels and acquiring high-profile rights.

“The big strategic question is, What do broadcasters do in a world where you don’t need channels?” says Wim Sweldens, chief architect and co-founder of mobile applications company Kiswe, whose activities include localizing OTT content around the world for major rights owners.

STRATEGIC PIVOT “Broadcasters can struggle with OTT because they have done things in the same way for so many years and it has worked,” notes Taylor Riese, managing director for EMEA at Verizon Digital Media Services. “Pivoting is not easy. You have to decide how OTT fits with what you already do. Is it part of the broadcast operation? Is it a technology thing? It’s an adjustment.”

He sees a world where traditional television won’t have any sports, which have long been a scheduling linchpin (especially on weekends) for so many broadcasters.

“It’s easier to monetize other content that you create in the studio or license rather than one-off live programming with expensive rights attached and value that evaporates,” Riese says. “Ultimately, a lot of what will be decided in the future comes down to what the big rights owners decide about where their programming goes.”

To complicate the picture, many prominent sports rights owners have their own OTT ambitions. For example, in Spain, where RTVE, Mediaset España and Atresmedia are partners in the OTT venture LOVEStv, the national soccer league, La Liga, has already created its own subscription platform, LaLigaSportsTV. “We want people to be as close to our competition as they are to their favorite HBO show,” says Javier Tebas, president of La Liga. “In our world, the players are the stars, and we can bring their story to life through camerawork, sound and visual spectacle. It doesn’t matter what genre you are producing, the user expects the same level of quality.”

He adds, “It’s clear that younger viewers expect more than the traditional TV broadcast. The new battleground for our industry will be across multiple screens.”

SUBSCRIPTION OVERLOAD? With fragmentation intensifying, companies need to think about how all this looks to the consumer. Research shows that the number of different subscriptions a household will absorb is about four. So how many different apps will people accept? Bear in mind that they aren’t getting any volume discounts like with a channel bundle. And they have to launch a separate app every time they want to watch each OTT offer.

It can be pretty consumer-unfriendly.

“Broadcasters need to start thinking like retailers,” says Bhavesh Vaghela, the CEO of subscription management company Paywizard, whose clients include Digital UK, ITV Box Office and BT Sport. “There is sometimes a perception that the industry is going to a more content-centric model when, in reality, it is becoming customer-centric.”

Joyn is already heading that way. “While Joyn has its own brand identity, we understand ourselves as an aggregation platform housing the most entertaining content,” Vassilev says. “Our brand is never the leading element in our communication. Instead, we strive to give center stage to the content from our various partners and extend its reach to a larger audience. You could say our ambition is to create a unique entertainment destination that unites all local content providers, local originals and a massive VOD library under one roof and one delightful experience. We ultimately define our success based on user feedback, whether from active users, paid subscriptions, or positive comments we receive on social channels.”

The new collaborative hybrids will probably need long investment horizons, as well as strong management that can get partners who are used to competing with each other to pull together. The process of getting to scale will not be easy.

And remember, Netflix and Amazon (and those other FAANGs) will come out swinging. They’re not just sitting there watching new OTT competitors crank up.

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