Mediavision: Advertising revenue is increasingly important for streaming services

PRESS RELEASE

30 August 2024

A clear growth for TV streaming subscriptions with advertising, also called HVOD, has been observed during the second quarter, according to Mediavision’s latest analysis of the Swedish TV and streaming market. These hybrid subscriptions, which offer lower prices in exchange for advertising, have become increasingly popular, especially as the growth of the more expensive, ad-free subscriptions has stagnated in the past year. For the actors in the market, these lower priced streaming services could be the key to regain growth.

 

Ad-funded streaming subscriptions, HVOD, continue to grow in Sweden. Today, close to 400,000 households have chosen to acquire at least one streaming service that is partly financed by advertising. Even though HVOD is a relatively new concept, growth has been strong during the year. Since the beginning of 2024, Mediavision has noted a growth of 40 percent.

 

“Times have been financially challenging for Swedish households in recent years, which partly explains the diminishing growth for TV streaming subscriptions,” says Marie Nilsson, CEO at Mediavision. “It is probably one of the reasons why many people appreciate the lower prices that advertising services offer.”

 

“This development also means a redistribution in the streaming market as a whole,” continues Nilsson. “In order to compensate for the lower prices, both advertising revenue and an increased number of subscribers are required. Today, several of the largest actors in Sweden offer HVOD, and Viaplay is the latest to launch such a subscription. Four out of the five largest streaming services now have HVOD as an option, and there are strong indications that more actors will follow.”

 

“TV advertising is something that most people are used to, so it is not surprising that streaming services also seek advertising revenue. This becomes especially important as the costs of content production and sports rights rise sharply. For the streaming market to continue to develop, greater revenues are required,” Nilsson concludes.