Transactional Video Market Returns to Growth in Nordics: Study

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Futuresource Consulting cites "changing consumer behavior" amid the virus pandemic as a factor, even though SVOD services dominate, with Disney+ likely to push subscribers and spend "to a whole new level."

Sweden, Denmark, Norway and Finland have big subscription VOD markets thanks to their strong broadband infrastructure, populations' English-language skills and a high level of disposable income. But Futuresource Consulting in a new report says that consumers in the Nordics are not only subscribing to multiple SVOD services, but also driving a rare return to growth for the transactional video market.

The research and consulting firm projects a 4 percent increase in transactional video buying or renting across DVD, Blu-ray and digital for 2020, marking the second consecutive year of growth.

"To see transactional video shifting course and moving into a growth phase is something of a rarity," says Tristan Veale, market analyst at Futuresource. "These countries are expected to be among the first markets to experience the reversal, a direct result of changing consumer behavior in the face of COVID-19." He explained that globally "DVD and Blu-ray declines typically tend to outweigh any digital growth." 

The biggest player in the digital transactional space in the Nordics remains Apple, "though key growth service Viaplay is successfully upselling transactional video to its existing subscriber base and is a close second," the analyst added.

Nonetheless, SVOD services dominate the market in the Nordics, accounting for 80 percent of the home video spend in 2019, with Netflix, Viaplay and HBO Nordic being the lead services.

Said Veale: "In 2019, for every dollar spent on transactional video, four dollars were spent on SVOD. Yet, there is plenty more opportunity for growth. With three major established services in the shape of Netflix, HBO Nordic and Viaplay, and new entrant Apple TV+, which launched in the third quarter of 2019, plus the upcoming Disney+ launch, we expect subscriptions and spend to be pushed to a whole new level."

Disney+ earlier this year said it would become available in additional Western Europe markets, including the Nordics, in the summer.

Meanwhile, Futuresource says Netflix may be "slowly approaching saturation" in the region "as over half of all households across these four Nordics have a subscription."