The American streaming giant Netflix has enjoyed a rapid and steady growth ever since the service launched in Sweden in October 2012. This development came to a halt in the second quarter of 2014, with Netflix for the first time recording zero growth. Instead, its American competitor HBO has picked up the pace after a slow start. HBO Nordic is now the fastest growing streaming service on the Swedish market.

During 2014, one hundred thousand new households have begun subscribing to the stand-alone streaming service HBO Nordic. With this, HBO is now finally starting to challenge Netflix, Viaplay (Modern Times Group) and the other actors on the quickly growing Swedish market for subscribed video streaming services. However, it still has a ways to go to close the gap to market leader Netflix, currently at 640 000 subscribing customers.

The Swedish market for subscription-video-on-demand (SVOD) is one of the most competitive globally. Sweden was one of Netflix’ first international markets and also the stage for Time Warner’s pilot project HBO Nordic; the first time HBO has offered its content as a stand-alone online streaming service. Netflix was off to a quick start upon launch, while HBO Nordic struggled initially with delays, limited functionality and an unpopular one-year binding period that was later abandoned for a more flexible, Netflix-like subscription model.

Although total subscriber numbers for the market as a whole only increased modestly over the last quarter, more than one million Swedish households now subscribe to a streaming service, translating into a 25% household penetration. In addition, an increasing share of the households now subscribe to two or more different services, all the while linear TV viewing is declining rapidly.

– What we are seeing now are the first signs of a maturing SVOD market. The slowed growth is partially an effect of seasonality; Swedes simply consume less TV and video during the summer. Also, unlike with regular pay TV subscriptions, people can cancel their streamed subscriptions temporarily while vacationing if they are not watching. But consumer interest in subscribed video streaming remains high and the market will keep growing this fall – we are nowhere near the peak yet, says Marie Nilsson, CEO and founder of Mediavision.

Press release August 2014 – English version

Mediavision estimates that roughly a third of all Swedish households will subscribe to a streamed video service within the next twelve months.

Mediavision follows the development of the emerging streaming market on an ongoing basis.