European VOD registers just 1% of TV revenue
By Julian Clover

A report on behalf of the European Commission has found that while video on demand is growing in importance it still only represents 1% of total TV revenues.

The Study on the implementation of the provisions of the Audiovisual Media Services Directive concerning the promotion of European works in audiovisual media services, led by the consultancy Attentional, found that most of the growth is coming from advertising funded services rather than pay.

The majority are delivered via open systems and consequently available to everyone and not subscription-based. These services are typically ad funded or funded through public funding.
It is estimated there are 435 invividual catch-up and VOD services available across the so-called E30.
Total TV industry revenues reached €77 billion in 2009, with a fall in advertising revenues and a greater reliance on public funding. Pay-TV continues to be a driver of growth, but cable relay revenues are falling as the migration to digital continues.

Germany and the UK are by far the two largest TV markets in Europe; France and Italy – which have similar sized economies to that of the UK – are somewhat smaller. Newer member states have a greater reliance on advertising and less on the public purse.
The number of premium pay-TV homes has increased with digitization. DTT now reaches 60 million households. IPTV continues to grow, but only has a significant presence in some markets.

Attentional says that key terms within Articles 16 and 17. Key terms within the AMS directive have been transposed differently from one Member State to another. This means that the qualifying hours are more prescriptive in some member states than others. Most, but not all, have defined the term ‘independent producer’.

Most Member States have simply reproduced the wording of the Directive mandating that ‘an adequate proportion’ of independent works be ‘recent works’, but some States went further and specified a minimum proportion.
The study goes onto say that the semi-automatic link between the between the content shown on TV channels and the viewing of that content is weakening.

“In the early years of broadcasting there was only room for a few channels and viewing was strongly conditioned by the available content. Thus there was a correlation between the amount of European content available on television and the viewing of European content,” says the report.
However, Europeans still have a strong regard for content made in their own countries, even if this is weakening among the young, a trend Attentional says will continue.