Europe Streaming Market on Pace to Grow to $12.5 Billion by 2023

Nik Konietzny/Bavaria Fiction GmbH
Lizzy Caplan in Sky's reboot of the 1981 submarine epic 'Das Boot.'

The U.S. remains the biggest single territory for SVOD, but with growth slowing, Europe is catching up.

Europe has become the battleground for the future of streaming television, and the battle lines between established broadcasters and the insurgent FAANGs (Facebook, Amazon, Apple, Netflix and Google) will be drawn at this year's MIPCOM.

The global TV market comes in the wake of Comcast's $40 billion deal to acquire European pay TV giant Sky, Disney's recent announcement of its own direct-to-consumer online platform that will launch in 2019, and unprecedented investment in localized European programming by Netflix and Amazon. Sky has been upping its investment in such original series as a reboot of the German anti-war classic Das Boot, set just after the events of Wolfgang Petersen's 1981 submarine epic.

These developments come alongside efforts by regional broadcasting giants to boost their online presence. Germany's ProSiebenSat.1 has linked up with Discovery Communications' Eurosport network on a joint SVOD platform, and France TV, M6 and TF1 have launched Salto, a French-language streamer. The BBC, ITV and Channel 4 are pledging $165 million to make their digital TV platform Freeview a full on-demand service, and ITV has said it is exploring plans for its own stand-alone SVOD operation, though its hasn't yet set aside cash to do so.

The U.S. remains the biggest single territory for online streaming, but with growth slowing, Europe is catching up. A report in September from Research and Markets forecasts SVOD revenue in Western Europe will nearly triple from $4.4 billion in 2017 to about $12.5 billion in 2023, near the value of the SVOD market in the U.S. today.

Set up against the FAANGs' financial might, Europe's regional broadcasters might seem puny, but Simon Murray, principal analyst at U.K.-based Digital TV Research, says Europe's local giants can still compete if they focus on their key strength: local programming. "These channels know their market, they know their audiences, better than anyone," he says. "If they can find the right programming and find the right business model that mixes advertising with subscription and doesn't go head-to-head with Netflix, they'll do well. Europe will be a big market, and there is a lot of space for everyone." 

This story first appeared in the Oct. 10 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe