IHS: Domestic 4K UHD TV Shipments Surge Due to Pending Chinese Tariffs

Sales and shipments of 4K UHD televisions has hit 60% market penetration in some parts of the world, including the United States, according to new data from IHS Markit.

Speaking Oct. 14 at the MIPCOM confab in Cannes, France, Paul Gray, research analysis director at the London-based IHS, said 4K UHD TVs now exceed more than half of all TV shipments worldwide.

The analyst contends there are more than 260 million 4K UHD households globally — a tally that is expected to reach 574 million households by 2023, according to Advanced-Television.com, which reported Gray’s comments from France. About 34% of North American homes have 4KUHD TVs, increasing to 64% in the next four years.

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Notably, domestic shipments of 4K UHD TVs surged in North America as distributors stockpile inventory ahead of any proposed tariff increases on Chinese-manufactured products by the Trump Administration.

Meanwhile, next-generation 8K resolution continues to grow slowly with 167,000 display units shipped in 2019. This is expected to reach 3 million units by 2023.

France’s Pay-TV Service Canal+ Inks Netflix

If you can’t beat them, join them.

More than a year after Canal+ Group CEO Maxine Saada blamed Netflix and Amazon Prime Video for undermining a branded subscription streaming video service, Canal Play, the pay-TV operator has signed up Netflix.

Canal+ will begin offering subscribers direct access to the SVOD behemoth beginning Oct. 15 with single €35 monthly fee, which includes €20 for pay-TV and €15 for movies and TV shows from Netflix, Amazon Prime Video and HBO.

Canal+ warns that the loss-leading €15 surcharge is to lure subs and won’t last forever, which means a future price hike.

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“Netflix is the global reference in the industry with world-acclaimed shows,” Said said in a statement. “This offer complements our all-round offer of first-run movies, major live sports events, world-class series, including our Créations Originales. It also helps us further consolidate our position as a key aggregator of content and services.”

For Netflix, which already has more than 6 million French subs after a sluggish start, the partnership underscores original content possibilities.

“Great stories can come from anywhere and be loved everywhere – and we’re committed to helping more people access a diverse range of content from creators all around the world both on Netflix and through our partnership with Canal+,” said Netflix CEO Reed Hastings.

 

Analyst: French Home Entertainment Third-Largest in Europe

The French TV and video entertainment market has struggled in recent years as over-the-top video undermines traditional distribution.

Now, the French, along with every other home entertainment market, has embraced SVOD as home entertainment — if for no other reason than statistics.

Futuresource Consulting says total video entertainment consumer spend is expected to exceed €7 billion ($7.7 billion) this year, making France the third-largest video entertainment market in Europe.

“Despite the closure of CanalPlay, SVOD has started to take off in France driven by Netflix’s fantastic performance,” analyst Tristan Veale, said in a statement.

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Veale attributed Netflix surge among French consumers due to part to the service spending freely for the rights to key local language TV shows, which have been well received and have created a buzz around the service.

“From 5 million subscribers at the end of 2018, representing half the market, we are expecting their sub base to grow further in 2019,” Veale said.

Indeed, SVOD revenue is expected to hit €827 million ($918 million) this year.

According to a Futuresource consumer survey, viewing Netflix on a TV is now the dominant way to watch the service in France.

“Over two-thirds of Netflix users now say viewing on any TV is their most preferred way, with Smart TV’s in particular a key driver, a trend we are seeing in many other markets we survey,” Veale said.

Notably, as myriad consumers worldwide subscribe to multiple SVOD serivces, the practice is still relatively uncommon in France, with less than 40% of SVOD households taking more than one service, with no significant challenger to Netflix since CanalPlay exited in mid-2018.

Futuresource contends the competitive landscape is expected to change as Amazon Prime Video ups its activity in the country and expected new SVOD entrants such as Disney+, Apple TV+, HBO Max and others target the French market over the next couple of years.

While these new services provide consumers more choice, Futuresource believes this trend will ultimately become frustrating for consumers, as programming choices become increasingly fragmented.

The research firm believes service providers that aggregate multiple services, provide pan-service search, navigation and provide a seamless user experience amongst the clutter of SVOD services will rise to the top.

Aggregation of other entertainment content, including video games and music, could also be a differentiator moving forward.

Companies like Apple with a broad range of TV/Video, music and games content could offer attractive “triple play” content bundles – Apple +, Apple Music and Apple Arcade, according to Futuresource.

“Gaming in particular is taking an increasing share of the consumer wallet, the French gaming software market will hit €3.5 billion ($3.88 billion) in revenue this year, with strong growth anticipated over the next few years,” Veale said.

Amazon Prime Video Secures Distribution With Altice European Subsidiaries

Amazon (and Amazon Prime Video) may be available in the U.K., France, Germany and Italy via the Internet. Now, the No. 2 SVOD service behind Netflix has secured direct access deals with pay-TV operator Altice Europe.

The Dutch-based owner of New York-based Cablevision, inked a deal with Prime Video to make the latter’s content directly available via set-top boxes of SFR in France and Altice units in Portugal, Israel and the Dominican Republic, among others.

SFR will be the first of Altice operations and the first operator in France to have the Prime Video app within its LaBox SFR Fibre, SFR Box Plus and SFR Box 8 set-top boxes.

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Subs will have access to Amazon Originals “The Marvelous Mrs. Maisel,” “Good Omens,” “Tom Clancy’s Jack Ryan,” “The Grand Tour,” “The Boys,” “The Man in the High Castle,” “American Gods” and the highly-anticipated “Carnival Row,” an American neo-noir fantasy Web television series with Orlando Bloom and Cara Delevingne launching this fall.

SFR customers will also have access to local Originals like Jérôme Commandeur: Tout en douceur and Raphael Varane: Destin de Champion, and popular French and Hollywood movies.

A large selection of titles on Prime Video are available in Ultra High Definition (UHD) and HDR.

The deal furthers Altice’s strategy combining third-party over-the-top online video apps and services with its own content and TV functionality in an integrated experience. The launch will commence after the arrival of Amazon Alexa within SFR Box 8.

“We’re excited to collaborate with Amazon to deliver its highly-popular content, including Amazon Originals and Exclusives, directly to our consumers,”Alain Weill, Altice Europe CEO, Altice France Chairman and CEO, said in a statement. “We know our customers want to see their favorite shows and programming on their big screen at home, and our collaboration with streaming services like Amazon continues to make that happen.”

Indeed, earlier this month, Mexico’s Totalplay became the first SVOD service in Latin America to offer direct access to Prime Video.

Amazon is also bowing its first original series in Australia with “LOL: Last One Laughing,” starring Rebel Wilson.

Digital Media Companies, Trump Unite Against New French Tax

Digital media companies, including Amazon, Apple, Google and Facebook, are getting an unlikely assist from President Trump against a proposed 3% tax in France on revenue derived from digital ad services and user-to-user transactions.

Specifically, the tax targets revenue derived in part off of French consumer online activities, including ecommerce, streaming video and audio.

Trump & Co. are crying foul since the tax largely applies to about 30 American companies generating at least €25 million ($27.8 million) in France and €750 million ($842 million) worldwide.

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France, which has tried unsuccessfully to secure European Union support on the move, argues the traditional system doesn’t work on these companies since they operate internationally with little physical presence in the country.

“This is a concern for international trade and the wider economy if countries follow the [Digital sales tax] model and select specific sectors and groups of foreign companies for targeted tax policies,” Nicholas Bramble, trade policy counsel at Google, said in a statement.

“The French tax is unjustifiable in that it infringes international agreements, and unreasonable in that it is discriminatory, retroactive and inconsistent with international tax policy principles.”

“They shouldn’t have done this,” Trump told the media in July. “I told them, I said, ‘Don’t do it because if you do it, I’m going to tax your wine.’”

France contends the tax would help level the playing field.

“These digital giants use our personal data, make huge profits out of these data then transfer the money somewhere else without paying their fair amount of taxes,” said French finance minister Bruno le Maire.

Ampere: It’s Still a YouTube/Netflix Video World

Google-owned YouTube and Netflix remain the top sources for online video and subscription VOD, according to new data from Ampere Analysis.

The London-based research firm found that 63% of survey respondents streamed a video on YouTube in the past month, followed by 39% doing the same on Netflix and 27% on Facebook.

The survey is based on 41,000 online respondents across 20 markets conducted in the first quarter (ended March 31).

Ampere found YouTube ranked the No. 1 source for online video consumption in every region worldwide except the United Kingdom (BBC iPlayer) and China (iQiYi).

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Indeed, more than 60% of respondents in France and Japan watched YouTube, while less than 50% of respondents in the U.K. did so.

As expected, SVOD consumption is highest in the United States – birthplace to Netflix, Amazon Prime Video and Hulu.

Notably, American tech platform – Facebook – continues to lose video views – down 5% to 23% of respondents since the third quarter of 2016. YouTube fell 4% to 66%, while Netflix increased 15% to 37% of respondents.

“YouTube’s global dominance in this space is evident in its monthly usage,” Minal Modha, consumer research lead at Ampere, said in a statement. “The differences in viewing between the U.S. and Europe in relation to catch-up and SVOD services is interesting because it shows that SVOD providers will have to work harder in Europe to grow their [market] share as they take on traditional TV channels’ catch-up services. This could be through their catalogue, price-points or communications strategy.”

 

Netflix Spain Raises Prices

Netflix is continuing to roll out price hikes across Western Europe with Spain reportedly the latest country to see a €2 monthly increase to €12.99 ($14.80) from €10.99 ($12.52).

Netflix previously raised prices in Germany, Austria and Switzerland.

Netflix Spain also upped the fee for Ultra-HD on up to four devices to €15.99 ($18.22) from €13.99 ($15.94). The basic plan remains unchanged at €7.99 ($9.11) per month.

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Netflix in January raised by $2 its most-popular plan in the U.S. to $12.99 from $10.99. The basic $7.99 non-HD plan increased to $8.99, while the premium plan allowing four simultaneous 4K streams increase to $15.99 per month from $13.99.

French Broadcasters Up Content Production to Combat Netflix, Amazon Prime Video

After a slow start, Netflix France has topped five million subscribers despite alienating exhibitors ignoring local theatrical windows for original movies.

To combat Netflix, Amazon Prime Video and over-the-top video distribution in general, French broadcasters are increasing their investment in local original productions.

Last year, the country’s top broadcasters — France Télévisions, Canal+, TF1, M6 and Orange — spent €5.4 billion ($6.1 billion) on content, with over 40% of that spending dedicated to original programming, according to new data from Ampere Analysis.

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At the end of May, 106 new local shows were in development or production, while Netflix is currently producing 15 new TV shows for the French market.

“French consumers are adopting digital TV subscriptions quickly, and the local broadcasters know they must respond fast if they are to protect their revenues in a changing media landscape,” analyst Léa Cunat said in a statement.

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While increased competition from OTT services has French broadcasters on the defensive, proactively engaging in content production in the face of waning advertising revenue and budget cuts has some operators rethinking their business models.

As a result, licensing third-party content has given way to original productions. This strategy offers two significant benefits, according to Ampere: monetizable IP portfolios and a diversified revenue stream.

Pay TV group Canal+ launched a new SVOD service in March – Canal+ Séries – dedicated to a younger audience, supported by shows such as “Mouche,” a reboot of the BBC’s “Fleabag”.

TF1 just announced plans to further enhance its TVOD platform, MyTF1, with new advertising inventory and new exclusive content.

France Télévisions is focusing on international partnerships with other broadcasting groups to help support its local content investments.

Orange created a new division – Orange Content – merging pay-TV operations with the film division to produce original episodic programming. Literary adaptation The Name of the Rose was the first  original show to air, broadcast in March.

Ampere says SVOD represented only 3% of France’s €14 billion ($15.8 billion) audiovisual market in 2018.

France’s OTT market lags a number of its peers – including Scandinavia, the U.K. and the U.S. – but digital subscriptions are growing rapidly.

To tap into this growth broadcasters France Télévisions, TF1 and M6 announced the creation of Salto, a new SVOD platform set to launch later this year.

Offered alongside their free channels, Salto will provide TV shows and exclusive content with an emphasis on French and European productions.

Through this new service, the broadcasters aim to generate revenue from subscriptions and maintain control over content rights following their initial broadcast window.

For instance, France Télévisions has said it will cease licensing the French digital rights of “Call My Agent!” to Netflix and has signed an exclusivity time period on digital rights for the shows it co-produces or commissions.

“With increasing competition from international behemoths Netflix and Prime Video, there’s no shortage of tactics and strategies being employed to stay in the game,” Cunat said. “It’s a fascinating market to watch as it transforms.” 

Indeed, French broadcasters are looking abroad to grow key markets, including Africa where Canal+ has more than 4 million subscribers across 25 countries. This market has a rapidly expanding middle class with growing disposable income, which makes it particularly appealing.

Once again, the broadcasters have taken different approaches to international expansion.

Canal+’s production arm StudioCanal launched a new TV production unit in February 2018, dedicated to creating premium original content for an international audience.

Canal+ also produces content dedicated to its foreign local markets: “Invisibles” was released in October 2018, the broadcaster’s first African original series, a market the broadcaster has earmarked for growth.

The pay-TV operator also collaborates at an international level and has worked on the U.S. remake of its original “Calls” with Apple TV+ and “Safe” with Netflix via a U.K.-based subsidiary.

TF1 is increasing its investment in European creation via Newen, a global production company it acquired in 2015. It has also bought stakes in European production houses in Belgium, the Netherlands and Denmark. Shows created by these companies include “Versailles,” “Ares” and “The Bridge”.

France Télévisions partnered with Italian broadcaster RAI and German broadcaster ZDF to fund and produce TV series for domestic and international audiences. Projects announced thus far include “Leonardo” and “Around the World in Eighty Days”.

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New Streaming Video Platform to Target Francophiles Outside Europe

A new streaming video platform aimed at Francophiles living outside France and Western Europe is under development by Julien Verley, director of business development at France Televisions, a state-owned TV broadcaster.

Dubbed “France+,” the SVOD channel/app aims to replicate the success of BritBox, the over-the-top video platform launched in the United States in 2017 by the BBC and ITV.

Verley, who is scheduled to leave Frances Televisions June 30 to work on the project, said the service would offer upwards of 3,000 hours of programming at launch featuring movies, dramas, documentaries, animation and TV shows.

Content would be dubbed in English, Spanish and Chinese Mandarin.

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Verley says France+ aims to capitalizeon the “art et douceur de vivre” of French arts, culture, creativity, society, heritage, history and education.

Julien Verley

“I’m confident this project … will expose French audiovisual creation, [a] scarcity [on] the large U.S. global platforms [i.e. Netflix and Amazon Prime Video], as well as the unprecedented opening of Anglo Saxons markets to international programs dubbed in English,” Verely said in a statement.

 The platform, which is seeking funding and would rely on third-party content libraries, is currently in partnership talks with Group Canal+, Group France Televisions and Group TF1, according to Verley.

“The quality, the diversity and depth of French and European programming represent an undervalued and underexploited [treasure-trove],” he said.

 

 

 

 

 

 

French Daily SVOD Use Increases 61%

Following a sluggish start, consumer adoption of subscription streaming video – notably Netflix – continues to grow in France.

New data from Médiamétrie found daily use of SVOD services increased 61% in 2018 from 2017 – including adding 2.1 million subscribers across various services.

In December, the top three movies streamed included Netflix’s Black Mirror: Bandersnatch, Mowgli: Legend of the Jungle and Extinction. Top TV series included season one of “The Protector,” “Suits” (season eight) and season one of “You”.

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“Today, nearly nine in 10 French people know at least one SVOD service,” Marine Boulanger, director of cinéma and entertainment at Médiamétrie, said in a statement. “This strong response is due to a multitude of factors such as word of mouth, multiplication of platforms and strong communication around original or exclusive content.”

Médiamétrie found the average SVOD user in France is around 34 years old, single or a young parent and more tech savvy than the average citizen. S/he typically owns a video game console or related streaming video device or smart TV.

Nearly 60% of survey respondents used a SVOD service in the past 12 months, with 50% of millennials using a streaming video service in 2018.

Indeed, 96% of SVOD users streaming content daily, and 15% plan to subscribe to a second service. More the 2.4 million French are considering subscribing to a SVOD service in the next six months from word-of-mouth recommendation.

At the same time, 58% of French SVOD subscribers also watch television live or on-demand daily, while 75% use multiple screens, including a laptop computer, smartphone or tablet. The laptop is used by 55% of French SVOD users; 73% among millennials.