Futuresource Consulting expects upturn in French TV and video spending

Tuesday, August 27th, 2019
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Futuresource Consulting Predicts Growth in French Consumer TV and Video Spend in 2019 for the First Time in Years

The French TV and video entertainment market has been sluggish overall compared to its major European counterparts. The expected upturn is due to the digital video market gaining momentum, driven predominantly by Netflix driving SVoD growth. Total video entertainment consumer spend is expected to exceed €7 billion this year, making France the third largest video entertainment market in Europe, this is according to the latest video insights report from Futuresource Consulting.

Total Video Entertainment Spend - TVOD+EST, Packaged Video, Box Office, SVOD, Subscription Pay TV - 2018 - France

“Despite the closure of CanalPlay, SVoD has started to take off in France driven by Netflix’s fantastic performance. They have acquired the rights to key local language shows, which have been well received and have created a buzz around the service. From 5 million subscribers at the end of 2018, representing half the market, we are expecting their subscriber base to grow further in 2019,” said Tristan Veale, Market Analyst at Futuresource Consulting. Overall, SVoD revenues are expected to hit €827 million this year.

According to Futuresource’s Living with Digital consumer survey, viewing Netflix on a TV is now the dominant way to watch Netflix in France. “Over two thirds of Netflix users now say viewing on any TV is their most preferred way, with Smart TV’s in particular a key driver, a trend we are seeing in many other markets we survey,” added Veale.

Taking multiple SVoD subscriptions is still relatively uncommon in France, with less than 40% of SVoD households taking more than one service, with no significant challenger to Netflix since CanalPlay exited in mid-2018. In other more developed territories, multiple SVoD service uptake is on the rise. In the USA, SVoD households are trending towards an average of three per household.

Netflix Competition in French Market Will Intensify, Driving Multiple Service Uptake

The competitive landscape is expected to change, as super content aggregators such as Amazon step up their activity in the country and expected new SVoD entrants such as Disney+, Apple TV+, HBO MAX and others target the French market over the next couple of years. Whilst these new services and D2C offerings provide consumers more choice, Futuresource believes this trend will ultimately become frustrating for consumers, as programming choices become increasingly fragmented. Service providers that aggregate multiple services, provide pan-service search, navigation and provide a seamless user experience amongst the clutter of SVoD services will rise to the top.

Aggregation of other entertainment content could also be a differentiator moving forward. Companies like Apple with a broad range of TV/Video, music and games content could offer attractive “triple play” content bundles – Apple +, Apple Music and Apple Arcade. Gaming in particular is taking an increasing share of the consumer wallet, the French gaming software market will hit €3.5 billion in France this year, with strong growth anticipated over the next few years.