Netflix Dominates Global SVOD Market, but Local Services Gain Ground, Study Finds

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Netflix CEO Reed Hastings

As Disney+ rolls out internationally, a new study shows local streaming services gaining a foothold among viewers, even as Netflix remains the market leader.

Netflix remains the world's global streaming champ, but national SVOD and online services are finding an audience in a rapidly growing market, according to new research from online video production group Grabyo.

In its annual Global Video Trends report, Grabyo surveyed 9,690 people across seven markets — the United States, the United Kingdom, France, Germany, Italy, Spain and Australia. It found that Netflix remains the global market leader in SVOD with 54 percent market penetration, a figure that jumps to 61 percent in mainly English-speaking territories. Amazon Prime Video is a distant second at 30 percent market penetration.

That first-mover advantage could have a significant impact on the growth of new streaming services rolling out globally over the next few months. Apple TV+ launched Nov. 1, and Disney bowed its Disney+ service Tuesday in North America and the Netherlands, adding Australia and New Zealand on Nov. 19. The service will start to roll out in other international territories in 2020.

Other Hollywood giants-backed streaming platforms, including WarnerMedia's HBO Max and NBCUniversal's Peacock, are set for 2020 bows in the U.S.

But the Grabyo report points to another trend in video streaming: the rise of local online players. In every territory surveyed, regional free or SVOD services, including the BBC iPlayer in the U.K. or France's Canalplay, are becoming increasingly popular with local audiences. Uptake for these local services jumped, on average, 22 percent. In the U.K., nearly a third of viewers use local online video services. That figure is likely to rise with the launch in the U.K. last week of BritBox, a streaming service that bundles content from leading British broadcasters ITV and the BBC. Channel 4 and Viacom-owned Channel 5 recently have also signed deals to deliver content to the new subscription service.

In Germany, Joyn, a streaming joint venture between local broadcaster ProSiebenSat.1 and Discovery, launched this summer, joining RTL's TVNow, the leading local streamer in the territory. In France's Salto, a SVOD backed by commercial networks TF1, France Television and M6, will bow early next year.

"OTT services are moving into the mainstream and are set to become the primary destination for video viewing in most markets," said Grabyo CEO Gareth Capon. "Traditional broadcasters need to evolve TV services to reflect the viewing preferences of modern consumers.

Organizations such as the BBC are successfully transitioning the TV offering to raise the profile and primacy of streaming and OTT services, but more is needed to enable consumers to watch when they want, whenever they want to."

Added Capon: "The traditional TV schedule is becoming less and less relevant for many demographic groups and with the upcoming launch of major new OTT services...the pressure on the traditional TV model will increase. OTT enables choice, flexibility and better value for consumers, we should expect the growth of these services to continue to accelerate."