The Nordic TV and video market has shown steady growth since 2021, following the pandemic. Growth is projected to have continued also this year, with total Nordic revenues expected to reach EUR 9.8 billion for 2023. The video market has grown by two percent yearly over the past four years and according to estimates made by Mediavision, the revenues will exceed EUR 10 billion in 2024. The Nordic video market is resilient and has gone through a strong digital transformation. Growth in digital revenues has counterbalanced a weakened broadcast TV market.
The total Nordic video market is expected to reach EUR 9.8 billion for the full year of 2023. The total market has grown two percent yearly over the past four years, excluding currency effects (fixed to 2019). If this growth rate remains, the market will surpass EUR 10 bill in 2024. The Nordic video market includes both advertising and paid subscriptions for broadcast and online, as well as cinema and public service.
Digital video services such as SVOD (subscription video on demand), TVOD (digital rental video) and AVOD (advertising-based video on demand) have all grown 10 percent yearly over the past four years. Growth has more than compensated for the two percent yearly decline in traditional broadcast TV revenues during the same period. The findings are presented by Mediavision and based on consumer research, market data and company reports.
The transformation to digital is also reflected in the development of revenue shares. The total broadcast revenue has declined from 50 percent in 2019, to 44 percent 2023. Cinema’s drop is explained by the significant decline during the pandemic.
– The Nordic video market is still going strong, mainly driven by consumers’ great interest in new digital services, comments Fredrik Liljeqvist, senior analyst at Mediavision. Despite a weakened general economy and a feeble advertising market, revenues are increasing. The number of paid streaming subscriptions is increasing and is now approaching a total of 20 million in the Nordics. Also, for the first time, we can now see that online viewing exceeds viewing of traditional TV on a Nordic aggregated level.
In many countries, it has become increasingly common to offer cheaper online video subscriptions that also include advertisements. In Sweden, there has only been a few such launches so far, where both advertising and consumer payments finance the service. However, there are many reasons to believe that this type of subscription will become more popular, as it enables lower consumer prices. For the industry, this could be a way towards further growth, if the low-priced plans lead to households acquiring more subscriptions. Mediavision can conclude that there is a significant interest among consumers in Sweden.
Cheaper streaming options, where households pay less because the subscription includes advertising, have launched on many markets. For example, in the US, Netflix has reported that the company’s ad-supported tier now has 23 million active users per month. This is still a relatively new phenomenon in Sweden. Currently, over 200,000 households, or about 7 percent of streaming households, have opted for a cheaper ad-supported alternative. This can be compared to 3 million households that have a fully paid streaming service without ads. In the autumn 2023, ad-supported options were launched by Disney+ and TV4 Play. Discovery+ also offers such subscription.
Mediavision has asked consumers about their interest in these subscriptions. If the five largest streaming services in Sweden were to launch cheaper subscriptions with ads, they could add up to 1.8 million new subscriptions. This would mean significant growth, but also that the companies’ revenues would include advertising as well.
Most signs point to an increased offering of ad-supported streaming services. Skyshowtime has communicated that an ad-supported subscription will be launched in April, in Sweden and other markets. Warner Bros. Discovery has also announced that the new streaming service Max will have such an option when it launches in Sweden this spring. Additionally, both Amazon and Netflix offer cheaper ad-supported options on several markets, but nothing has yet been communicated about a potential launch in the Nordics.
– As the pure pay-streaming market matures, new initiatives for growth are needed, comments Fredrik Liljeqvist, senior analyst at Mediavision. Advertising enables less expensive services for consumers but also new revenue streams for streaming services. This means households may consider acquiring more subscriptions, while advertisers in Sweden can reach many viewers with ads.