Spanish video entertainment to soar to €4.5bn by 2024
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| 26 October 2020
Having witnessed what the analyst said was a polarisation of fortunes in 2020, many segments within the Spanish video market have seen their audiences expand due to stay-at-home measures and changing consumer attitudes towards entertainment according to a new Video Insights report from Futuresource Consulting.
Netflix spanish spain 26Oct2020
The study showed in all that consumer spend in the country will grow by 11% per year, on average, between 2019 and 2024. Yet it also noted that in 2019, just 20% of households in Spain consumed SVOD. Lagging far behind France and the UK, at 31% and 50% saturation respectively, the Spanish market has plenty of headroom for growth. Spend more than doubled in 2019, and Futuresource expects spend to double again in 2020. With subscriptions on track to reach 10.2 million by the end of the year, the market is said to be stepping up a gear.

Indeed, said Joanna Wright, market analyst at Futuresource Consulting, the growing presence of Amazon Prime and HBO España, along with the launch of Disney+ and Apple TV+, is taking the market to another level. “We’ve seen a clear reshaping of the SVOD landscape this year,” she said. “At a time when the Spanish SVOD market was already in rapid growth, consumer confinement has created ideal conditions for those households who were reluctant to try SVOD services. And it’s not just a fleeting phenomenon. We expect this new-found interest in SVOD to persist over the long term.”

Beyond the aforementioned big five, Futuresource noted that there had also been an upsurge of niche SVOD services, all vying for consumer attention. These include specialist Spanish services such as Filmin, Flixolé, and Rakuten TV, StarzPlay and sports service DAZN. Telcos were also found to have played a key role in driving growth, building partnerships and are bundling offers, and integrating SVOD services into pay-TV packages.

“For the vast majority, Netflix is the gateway to SVOD,” Wright added. “Like so many other territories, Netflix is key to the growth in Spain and continues to dominate, with no signs of slowdown. But Netflix is far from the only one in town, and SVOD households in the region now subscribe to an average of 1.7 services.”

Lockdown was also found to have benefited the digital transactional market, with TVOD and EST both trending significantly higher than at the same point in 2019. Some studios even witnessed a year’s worth of transactions in six months. However, with the theatrical slate limited during the pandemic, Futuresource expects gains from the first half of 2020 will be softened by the lack of home video releases in the second half of 2020. It forecast that aggressive promotions and wider uptake of lower priced catalogue titles will lead to a more muted revenue performance in 2020, with EST and iVoD expected to grow 15% and 7% respectively in terms of spend.

Going forward, as a direct result of Covid-19, Futuresource forecast in the Video Insights report that SVOD uptake and consumer spend in Spain would remain higher than previously anticipated across the entire forecast period out to 2024. Despite the market challenges, opportunities abound, and total video entertainment spend will continue to surge upwards, with Futuresource predicting the market rising from just under €3 billion in 2020, to €4.5 billion in 2024.