(source: AP/TASR)
Two providers of streaming services entered the Slovak market last year. They offer movies and TV broadcast on demand enabling people to watch programmes according to their preference. Yet as they do not offer local content, even though they push the boundaries of customer care, traditional television broadcasters do not perceive them as competition.
Amazon Prime Video is available as of December 2016 in 200 countries, including Slovakia. It offers access to TV series and movies, as well as additional shopping services.
The broadcast is fluent, without interruptions by advertising. Netflix arrived to Slovakia in January 2016.
“The customers get a good offer of titles at a relatively good price, which is a good alternative to illegal downloading of content,” said Ondrej Podstupka, the tech editor at SME daily when commenting on the arrival of Amazon Prime Video.
Ondrej Macko, editor-in-chief at Touch-IT, added that the non-linear TV broadcast enables people to watch a programme at any time and on a wide range of devices.
No local content
Both Amazon and Netflix enrich the media market with on-demand content. They are a welcomed competition to the traditional broadcasters.
“Netflix has found its customers in Slovakia but it does not represent any dramatic challenge for the competition,” said Macko.
The main group targeted by streaming media is young people with good command of languages and proficiency in technologies. Podstupka believes that this group will grow naturally, but that Netflix will also try to expand into other groups of society.
“They [Netflix and Amazon] are rather a strategic menace that will maybe speed up the efforts of the television stations and operators in building their own digital content,” said Podstupka, stressing that the market outcome is currently very low. “The problem is that Netflix currently does not have any regional production. In order to be fully competitive with the local media, they must offer fully localised content.”
This means creating local programmes and providing the majority of the content with Slovak subtitles.
Miroslava Klempová, marketing manager at JOJ television group confirmed that Netflix and Amazon do not present a potential danger to traditional television.
“Our core business and at the same time our competitive advantage is the creation of local content and sale of advertising space in Slovakia,” said Klempová.
One of the main differences between streaming media and traditional television is the fact that television stations like JOJ offer passive entertainment, when the people turn on the TV and watch.
“On the other hand, Netflix and Amazon offer actively searchable content,” said Klempová, adding that this market segment is already taken.
Video streaming in Slovakia is also limited by the restrictions on licence protected content.
“They can broadcast only the programmes for which the licensing agreements are also valid for Slovakia,” said Macko.
“Many series or movies are available in Great Britain but not in Slovakia,” said Podstupka. It should, however, change with the content that Netflix produces itself. It also creates space for third parties to change and distribute their content.
“For example, the new series of Star Trek will be distributed via Netflix to all regions at the same time,” Macko said.
Freemium and on-demand services
Netflix was created in the 1990s, modelled on the gym membership scheme. Its founder, Neil Hastings forgot to return a borrowed video tape and he was fined 40 dollars. Immediately, he got an idea of making films available to people without the necessity of walking to a video rental store.
Since its beginnings, Netflix has transformed into a multinational company and added its own television production to its portfolio. House of Cards, starring Kevin Spacey is the most popular Netflix series, and also earned nominations for the Golden Globe awards.
In January 2016, Netflix expanded to 130 countries including Slovakia, offering streaming services for media and videos.
“We are a part of an international package of countries, with missing language and programme support,” said Podstupka. According to him, Netflix has only opened its offer and is waiting for the response, before taking further steps.
In a freemium model, the core services are free and include live streaming or access to a limited number of films. There might also be a limitation on the streaming speed. Additional services and higher broadcast quality are subject to higher fees.
Netflix offers three bands of subscription, from €7.99 to €11.99, according to the streaming speed and quality. According to Macko, the high subscription rate can be a disadvantage.
“On the other hand, we understand that it is broadcasting at minimal costs and therefore only part of the content originally available in the Western EU is accessible,” he said.
After a seven day free trial period, the price of Amazon Video is €2.99 per month. After six months of usage the price rises to €5.99. To start using the service customers need an Amazon Prime account and the Amazon Prime Video application, supported by iOS, Android and Amazon.
Alternative to traditional TV
On demand video providers can be a welcomed alternative to the traditional broadcasters, some of whom are withdrawing from the market.
From January 2017 the entire content of TV Markíza will be subject to paid subscription, as the broadcaster stops the terrestrial broadcast. The subscription is available via several mobile phone operators, which offer multiple packages.
Slovak Telekom offers satellite TV with 61 channels for €10 a month. Fiber TV from Orange is available at €11.99. Antik Sat “Pre začiatok” package offers 104 channels via the internet for €0.99 a month but you have to purchase a box with a card for €109.
Other broadcasters still offer free TV. Klempová confirmed that their main advantage is the local content and the sale of advertising space.
The portfolio of JOJ Groups includes 7 channels (JOJ, PLUS, WAU, RiK, Ťuki TV, JOJ Cinema a JOJ Family) and 13 web portals (joj.sk, plus.sk, wau.sk, rik.sk, cinema.joj.sk,jojfamily.cz, nadacia.joj.sk, huste.tv, noviny.sk, europskenoviny.sk, topstar.sk, premuza.sk, prezenu.sk) that offer streaming and video services for free.
In terms of the future Macko recalled that Slovaks are traditional consumers of TV content and it is not possible change that so quickly. Moreover, there is the language barrier and the fact that other services do not offer regional news yet.
Podstupka also does not expect any significant changes in the years to come.
“I do not think that in the next two-three years Netflix or Amazon Video will threaten the traditional television stations but they will gradually get a chunk of their market share,” Podstupka said.
