What are the prospects for subscription on demand (SVOD) services in Central and Eastern Europe?
A new report published by Digital TV Research paints an optimistic picture, forecasting there will be 68 million subscriptions across the region by 2029. This will be 27 million more than there are currently, with the biggest growth being seen in Russia (12 million) and Poland (6 million).
While Russia currently has the largest number of subscriptions (24 million), predicting the number in five years from now seems like a difficult task. Firstly, the report refers to the country’s “greater than expected resilience in the face of economic sanctions”. While I feel this is probably reflected in the growing popularity of on demand services and viewers’ willingness to pay for them – as of the end of June eight streamers has at least 1 million paying subscribers, with the market leader Kinopoisk claiming around 6.9 million – there is no denying that the quality of content they are offered has declined since Western companies stopped operating in the country. Piracy is also a major problem that cannot be overlooked.
Secondly, the report assumes that none of the US-based platforms will re-enter Russia before 2029. However, I think no one can foresee the geopolitical situation in five years’ time with any degree of confidence. Should the likes of Netflix once more start operating in the country, it would provide a major boost for the sector.
As for the rest of the region, the Polish SVOD market is undoubtedly the most dynamic and looks set to remain so for the foreseeable future. While Netflix is currently the dominant player, it faces competition from services including Player, HBO Max, Disney+, SkyShowtime and indeed CDA. The latter is one of the few to provide subscriber figures and it passed 500,000 earlier this year.
Elsewhere, local services such as CME’s Voyo, which only a few days ago launched in Croatia, are likely to continue going from strength to strength.
Given that Russia is forecast to account for just over half (53%) of the region’s SVOD subscriptions in 2029, the overall market shares of leading players such as Netflix, HBO and Disney+ may be lower than expected. Indeed, the report expects Kinopoisk to account for the most subscribers (10.6%), with Netflix (8.1%) in second place and Russia ivi (5.2%) in third.
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