IHS Markit: Amazon and Netflix Ramp Up Global Production

Since rolling out worldwide in 2016, streaming-video giants Amazon and Netflix are building their presence in local country markets with a growing amount of original content, according to IHS Markit.

Netflix launched 1,257 hours of original first-run content in 2017, well ahead of Amazon Prime Video’s 285 hours, according to IHS Markit. Netflix has also dramatically increased that content outside the United States, with 402 hours launching last year.

International content accounted for 40% of Amazon’s total original first-run output last year, compared to 32% for Netflix, according to IHS.

“The availability of local content is primarily how both platforms adapt their services to various countries, along with local currency pricing, local-language websites, dubbing and subtitling,” according to an IHS release.

Netflix global original production has jumped from the first season of “Lilyhammer” in 2012 to 300 titles in 2017.

“Offering content that is locally made, but which plays worldwide, is just one of the methods Netflix, in particular, has revolutionized the TV programming business,” according to IHS.

Amazon has stepped up original production, but is well behind Netflix in overall volume, IHS noted. Amazon Prime Video also produced a single international title in 2012, renewing a cancelled BBC series, “Ripper Street,” and the company has gone on to launch 56 such original titles in 2017.

“Netflix and Amazon have cast a wide net, in terms of program genres, commissioning dramas and comedies, children’s live action and animation, documentaries and rights to theatrical movies,” said Tim Westcott, director of research and analysis, channels and programming, IHS Markit, in a statement. “Both companies have also dabbled in reality TV, and they are expected to move further into this area in the future.”

According to the Channels and Programming Intelligence Service from IHS Markit, at the end of last year, Netflix had 52.8 million online streaming video subscribers in the United States. Netflix international subscriptions outstripped those in the United States in 2017, with 57.8 million at the end of the year. Amazon Video subscribers in the United States reached 30.2 million in 2017. Amazon Video, having switched on globally later than Netflix, is well behind in terms of subscribers outside the United States, which totaled just under 15 million at the end of last year.

“In the linear TV era, channels produced programming primarily for domestic consumption, with international sales an often lucrative — but definitely secondary — revenue stream,” Westcott said in a statement. “The time-lag between U.S. and international release also encouraged piracy of hit shows, like HBO’s ‘Game of Thrones.’ Now, both Amazon and Netflix are originating programming in order to capture a global audience, releasing their originals on the same day and date in multiple territories. This also means that non-U.S. programming has the potential to find an audience in the world’s largest entertainment market — one where subtitled or dubbed programming has been almost unheard-of outside the art-house cinema circuit.”

SVOD Subs Top Pay-TV in the United Kingdom

The number of consumers in the United Kingdom subscribing to an over-the-top video service such as Netflix or Amazon Prime Video has – for the first time – surpassed those opting for linear pay-TV, according to new data from Ofcom, the communications regulator in the U.K.

Subscriptions to the three most popular online streaming services – Netflix, Prime Video and Sky’s Now TV – reached 15.4 million in the first quarter, overtaking pay-TV subs at 15.1 million.

The amount of time consumers spent watching broadcast television continues to decline. In 2017, the average was 3 hours 22 minutes a day, down nine minutes (4.2%) from 2016, and 38 minutes (15.7%) since 2012.

There were steeper declines among children and viewers aged 16 to 34, meaning consumers over the age of 65 watched four times as much broadcast television as children in 2017.

“Today’s research finds that what we watch and how we watch it are changing rapidly, which has profound implications for UK television, Sharon White, CEO at Ofcom, said in a statement.

The regulator found daily viewing time across all devices stands at 5 hours one minute, of which two-thirds (three hours 33 minutes or 71%) was broadcast content, and 1 hour 28 minutes was non-broadcast content.

However, among 16- to 34-year-olds, total daily viewing time in 2017 was 4 hours 48 minutes, of which less than half (two hours 11 minutes or 46%) was to broadcast content, with just under an hour per day spent watching content on YouTube.

“We have seen a decline in revenue for pay TV, a fall in spending on new programs by our public service broadcasters, and the growth of global video streaming giants. These challenges cannot be underestimated,” White said.

Indeed, the BBC, ITV, Channel 4 and Channel 5’s £2.5bn combined spending on original, UK-made programs in 2017 represented a record low – and is £1bn (28%) less than the 2004 peak of £3.4bn. An increase in funding from third parties towards the cost of program-making has partly helped to offset this decline.

“But UK broadcasters have a history of adapting to change,” said White. “By making the best British programs and working together to reach people who are turning away from TV, our broadcasters can compete in the digital age.”

 

Roku Introduces Roku TV Wireless Speakers

Streaming device pioneer Roku July 16 unveiled the Roku TV wireless speakers, the first speakers made exclusively for Roku TV.

The speakers are “meticulously engineered and calibrated to deliver powerful, premium audio to Roku TVs,” according to a Roku press release.

“Because Roku controls the software in both the speakers and TV, Roku is uniquely able to provide seamless wireless setup and connectivity, optimize sound for the picture and ensure audio video sync,” the release stated.

Roku TV users can pre-order from Roku.com through July 23 for an introductory price of $149.99. From July 24 through Oct. 15, it’s $179.99. Beginning Oct. 16, pricing is $199.99. The speaker bundle begins shipping to customers by late October. The bundle includes two Roku TV wireless speakers, a Roku TV voice remote, a Roku touch tabletop remote, two Power Cables and four AAA batteries.

“Picture quality, a tremendous selection of content, value, and ease of use make Roku TVs some of the most popular smart TVs on the market today,” said Roku CEO Anthony Wood in a statement. “Adding great audio dramatically enhances the way people experience their favorite entertainment. With Roku TV wireless speakers, we’re able to offer our customers a simple and affordable way to further immerse themselves into the TV, movies and music they love, while providing them with a better whole home entertainment experience.”

The speakers can be wirelessly paired to Roku TVs via Roku Connect, according to the release. Once paired, users can listen to audio from any streaming channel on the Roku platform, live TV from an antenna, or other devices such as a cable set-top box through the speakers. The speakers support Bluetooth music streaming from mobile devices. The speakers also offer automatic volume leveling to lower the volume on loud scenes and boost the volume on quieter ones and dialog enhancement to improve the intelligibility of speech.

Roku TV wireless speakers work exclusively with Roku TVs, which accounted for one out of every four smart TVs sold in the U.S. in the first quarter of 2018, according to the company.

Emerging Markets Streaming Service Iflix Reaches 15 Million Subscribers

iflix, a streaming and download entertainment service for emerging markets, announced it has reached more than 15 million subscribers and experienced 250% growth since January 2018.

iflix is available to consumers in Malaysia, Indonesia, the Philippines, Thailand, Brunei, Sri Lanka, Pakistan, Myanmar, Vietnam, the Maldives, Kuwait, Bahrain, Saudi Arabia, Jordan, Iraq, Lebanon, Egypt, Sudan, Cambodia, Nigeria, Kenya, Ghana, Nepal, Bangladesh, Zimbabwe, Morocco, Tanzania and Uganda. It offers users unlimited access to thousands of TV shows, movies and other content including comedies, drama, K-drama, Turkish drama, Bollywood, Nollywood, cartoons, movies and live sports from Hollywood, the United Kingdom, Asia, the Middle East and Africa for a monthly fee.

“2018 is already a transformational year for iflix,” said iflix co-founder and group CEO Mark Britt in a statement. “We continue to be passionately obsessed with what emerging markets customers need and want. The huge growth we’ve seen across the business is a testament to that commitment. We have one goal and that is to make iflix ubiquitous across emerging markets. To achieve this, we will continue to learn and innovate to build global culture and find new audiences for extraordinary world class content.

The service is moving away “from the traditional Western SVOD model” to “culturally rich, engaging localized programming and features,” according to an iflix press release.

The service has seen growth in customer engagement, with content consumption doubling in the last five months for an overall 22.84 billion minutes (43,500 years) streamed since launch, according the iflix.

User data shows that local audiences have a strong preference for local content, according to the release. To cater to this demand, iflix has significantly increased its acquisition and commissioning of local content, with the aim of quadrupling its commissioning slate by 2019 with 12 original TV series, 30 feature movies and 75 short form films, the service announced.

iflix is beefing up resources for translation and subtitling, to help make its international content library more accessible to local audiences, the release noted.

In January this year, iflix announced a joint venture with Football Malaysia. The company has also added Bangladesh cricket, Formula E and 2018 World Cup Russia action, as well as music events.

The company has built a live hub with live streaming infrastructure and capabilities, enabling streaming of every World Cup match on its Kwesé-iflix service across Africa.

Households Upping SVOD Services

NEWS ANALYSIS – One of the hallmarks of over-the-top video has been the distribution channel’s ability to offer myriad programming at loss-leader pricing.

Thus, it’s little surprise the average broadband home in the United States subscribes to 2.8 OTT services – spearheaded by Netflix, Amazon Prime Video and Hulu – according to new data from Ampere Analysis. The global average is two SVOD services per household.

Through the first quarter of the year, monthly domestic household SVOD spending reached $35 – more than double the $15.60 spent in the previous-year period.

With Netflix and Prime Video driving global SVOD growth, monthly household SVOD spending the United Kingdom reached $18.70 compared to $10.40 last year.

“Netflix and Amazon have acted as catalysts for SVOD stacking, particularly in those European markets where they have seized the initiative through low cost subscriptions,” Toby Holleran, senior analyst at Ampere Analysis, said in a statement.

Indeed, French and Spanish households now average 1.5 and two SVOD services per household, respectively, despite the recent exit of CanalPlay from the French market.

“While some European countries have been slower to adopt SVOD, the American giants are now part of the package in virtually every SVOD household,” said Holleran. “This is particularly notable in Holland, where nearly three in four SVOD households take only Netflix.”

Ampere contends that while OTT video continues to rise in popularity, demand for traditional pay-TV remains relatively strong in some countries. Household SVOD penetration in the U.K. increased 4%, while pay-TV adoption remained unchanged.

Indeed, in Poland where pay-TV is relatively inexpensive, OTT video continues to struggle gaining traction among consumers.

“Although in some cases a growing number of SVOD subscriptions is leading to a decline in pay-TV, that is certainly not always the case,” said Tony Maroulis, research manager at Ampere. “Heavy stackers are most likely to have pay-TV services. Clearly, there’s a healthy appetite amongst consumers worldwide for quality content across a range of paid-for platforms.”

 

Wall Street: Netflix Top Choice for TV Entertainment

Consumers in the United States are increasingly choosing Netflix for their TV entertainment, according to a new Wall Street survey.

Investment firm Cowen & Co. found that 27% of 2,500 respondents in a recent survey chose Netflix, compared with 20% opting for basic cable and 18.1% for broadcast television.

Among the younger 18-24 demo, the percentage of respondents choosing Netflix increased to 40% — ahead of perennial favorite YouTube.

Cowen analyst John Blackledge said the survey underscores how important Netflix has become to the average household, especially among millennials.

The analyst said the subscription streaming pioneer upped original content releases 51% in the second quarter (ending June 30) to 452 hours compared to the previous-year period. Netflix is on tap to spend $8 billion on original content this year.

“[Netflix] continues to ramp its original content offering, including local originals in many international markets,” Blackledge wrote in a note as reported by MarketWatch.

Indeed, Netflix is projected to grow its international subscriber base from 83.6 million subs at the end of 2018 to 255.2 million in 2028.

Daniel Ives, chief strategy officer at GBH Insights, says the cord-cutting phenomenon is continuing to accelerate.

“It’s really about content,” Ives told Al Jazeera. “Netflix [has] really created a content arms war and you’ve sort of seen this across the board with the consolidation across the sector between AT&T, Time Warner, Disney and Comcast … it all speaks to ‘content is king’ in this cord-cutting world.”

“Ultimately, the only way you drive international sub growth is international content,” Ives said. “Whether it’s the Middle East, Africa or other parts of the world you’re trying to penetrate … it has created a new age for content and Netflix recognizes that as they expand internationally, content is the key.”

Netflix announces Q2 results July 16.

Netflix Announces New Series, Renewals at Anime Expo

Netflix announced two new anime series, the renewal of “Aggretsuko” for a second season, as well as dates and first look images for upcoming series as part of its panel at Anime Expo in Los Angeles.

New series and renewals include “Ultraman,” launching in spring 2019; “Kengan Ashure,” due in 2019; “Godzilla: City on the Edge of Battle,” launching on July 18; “Dragon Pilot,” due Sept. 21; “Castlevania” season 2, premiering Oct. 26; and “Cannon Busters,” due April 1, 2019.

At the event, Netflix director of content for Japan and anime John Derderian moderated a panel featuring anime creators LeSean Thomas (“Cannon Busters”), Adi Shankar (“Castlevania”) and Shinji Higuchi (“Dragon Pilot”).

“As Netflix has grown around the world we have been astounded by the broad reach and great depth of anime fandom,” Derderian said of the upcoming projects, according to Netflix. “We are partnering with the best global creators to produce a diverse slate of shows that we hope will excite the boundless passion of anime fans and make Netflix a premier destination for this beloved art form.”

Netflix Partners with Salma Hayek’s Production Company on Mexican Series

Netflix’s latest original series from Mexico will be produced by Salma Hayek’s company Ventanarosa, Lemon Studios and Stearns Castle.

The series, “Monarca,” will begin production this fall and will launch globally in 2019. It stars Irene Azuela and Juan Manuel Bernal and will follow the world of wealthy Mexican elites riddled by corruption, scandal and violence.

“I’m extremely excited to partner with Netflix, and to be working with amazing Mexican talent in front of and behind the camera,” said Hayek in a statement. “We are proud to show Mexico as a vibrant, sophisticated and culturally rich nation, fighting to control its own destiny.”

“Mexico is a top priority for us in which to continue to develop series, and we look forward to bringing the best originals to the world through partnerships with key players such as Ventanarosa and Lemon Studios,” said Netflix’s Erik Barmack in a statement.

Hayek’s Ventanarosa Productions has produced such films and TV shows as Frida, which earned Hayek an Academy Award nomination, and “Ugly Betty.”

Canal Plus CEO Blames Netflix, Regulation for Imminent Shuttering of SVOD Service CanalPlay in France

Canal Plus will close its SVOD service CanalPlay, due to waning subscription numbers in the face of competition from global players such as Netflix and Amazon, CEO Maxine Saada said during a hearing with the culture commission of the French senate, according to reports.

First launched in November of 2011, Canal Plus’s CanalPlay beat Netflix’s launch in France by nearly three years, reported Screen International.

CanalPlay at one time had some 800,000 subscribers but numbers have fallen to just 200,000 subscribers following Netflix’s arrival, Saada told the commission, according to reports. He said French regulations preventing CanalPlay from offering Canal Plus’s high-end originals on the service in the early years of its existence had hindered the ability of the service to compete with the global digital players, according to Screen International.

“At the moment when Netflix arrived on French soil, the only French SVOD player at the time was CanalPlay,” he said. “It had 800,000 subscribers, and we were banned from including originals in the face of Netflix and Amazon.”

That ban has since been lifted, but Saada said the change had come too late, Screen International reported.

“It’s over for CanalPlay. In two years, it has been erased from this market which is in the process of replacing that of television,” he told the French legislators.

“The announcement that CanalPlay is to close in France is another reminder of the growing requirement for major content investment to compete in the increasingly dynamic subscription video sector, particularly amongst local services,” stated Futuresource Consulting after the announcement. “CanalPlay will join the list of high profile closures worldwide over the last couple of years, all with significant parent companies; that includes Shomi (Canada), Watchever (Germany) and KPN Play (Netherlands). Futuresource estimates that CanalPlay had approximately 600,000 subscribers at the end of 2017, but has struggled to maintain pace in 2018 as Netflix momentum continues to build. Netflix doubled its subscriber base in France in 2017 hitting 2.5 million, with more subscriber growth expected for 2018.”

“Offering content that is unique, high quality and ideally, exclusive or original” is key, the Futuresource commentary noted.

“Such a strategy does not come cheap though, something that Canal+/Vivendi was seemingly not willing, or able to fund, particularly when its addressable market is more localised than the likes of Netflix or Amazon Prime Video,” Futuresource stated.

Netflix to Adapt Salman Rushdie’s ‘Midnight’s Children’ for Global Original Series

Netflix announced a new Netflix original series based on Sir Salman Rushdie’s book Midnight’s Children. The series will be available exclusively to more than 125 million Netflix members in 190 countries around the world.

Midnight’s Children won the 1981 Booker Prize, the Best of the Booker twice — both in 1993 and 2008, and the James Tait Memorial Prize. Sir Salman Rushdie was knighted in 2007 for services to literature.

Midnight’s Children is one of the great novels of the world, and its themes are still relevant to the India of today,” said Erik Barmack, VP, international originals, Netflix, in a statement. “The narrative continues to fascinate audiences decades after it was first published. We are incredibly excited to translate this pioneering work of fiction that parallels the birth of modern India, for a global audience. The rich experience and talent of Indian creators combined with the global reach of Netflix, have the potential for millions of more people around the world to rediscover this story.”

“I am absolutely delighted that Midnight’s Children will have a new life on Netflix, and greatly look forward to working with them to help create it,” Rushdie said in a statement.

Midnight’s Children follows the life of Saleem Sinai, born on the stroke of midnight on August 15, 1947, the time of India’s independence. His every act is mirrored and magnified in events that sway the course of India’s national affairs. Telepathic powers also link him with India’s 1,000 other “midnight’s children,” all born in that initial hour and endowed with magical gifts.