Markets

The third day of NEM Dubrovnik (June 9-12, 2025) kicked off with a panel discussion titled "Europe’s Audiovisual Future: Do We Have the Necessary Conditions to Succeed?" The session, moderated by Julia Maxwell, Executive Director of the European Video on Demand Coalition, offered a comprehensive overview of the European audiovisual market's evolution since 2018, highlighting both its growth and the significant challenges it faces in the digital age.

Christian Grece, European Television and On-demand Audiovisual Markets Analyst at the European Audiovisual Observatory, provided key insights into the dramatic shifts. He noted that while the European audiovisual market has experienced clear growth since 2018, the lion's share has been captured by over-the-top (OTT) and digital players. Netflix and Amazon have dominated the subscription market, while YouTube and Meta have led the charge in advertising.

"Our non-traditional players, broadcasters, have also launched their digital offers to adapt to the streaming age, but they are lacking the scale these global players have," Grece explained. "And of course, this gives them a competitive advantage."

The subscription market, encompassing both pay-TV and SVoD (subscription video on demand) services, has seen a remarkable transformation. Since 2018, SVoD subscriptions have clearly overtaken pay-TV subscriptions, demonstrating explosive growth. While pay-TV subscriptions have remained almost stagnant, this shift has translated into increased SVoD revenues. However, a significant hurdle emerged: despite having more subscriptions, SVoD generates less total revenue than traditional pay-TV. Grece underscored this, stating, "The average revenue per user is much lower than in a traditional business. And this underlines the need for scale."

A similar trend is evident in the video advertising market. Linear TV advertising on a European scale has decreased since 2018, with growth primarily coming from video sharing platforms, and more recently, AVoD (advertising video on demand) and FAST (free ad-supported streaming television). This indicates a clear challenge for traditional linear advertising from these new digital entrants.

The competitive landscape has also been reshaped. In 2023, digital players like Netflix, Amazon, and Disney+ secured three spots in the top 10 players on the European subscription market. On the advertising side, YouTube and Meta hold the top two positions, with TikTok making a significant entrance into the top list. More broadly, looking at the top 100 European TV players, OTT players have increased their market share six-fold since 2016, capturing most of the market's growth.

Content investment and the share of European content in catalogs were also key discussion points. In 2024, streaming services already account for one-third of all European content investments, with Netflix, Amazon, and Disney+ contributing the majority. However, these investments are concentrated in a handful of countries, primarily the UK and Spain, with content then circulated across other European nations. Traditional broadcasters, in contrast, have seen only a modest increase in their investments since 2018.

Regarding the share of European works in YouTube catalogs, the 30% quota is met on average, standing at 32%. However, Grece highlighted a crucial nuance: "The majority of EU works in these catalogs is of non-national origin, except in a handful of big markets." This means that many local audiences have limited access to locally produced content. While generalist EU services tend to hover around the 30% quota, niche services often have a lower share of European works, while national broadcasters' catalogs typically exhibit a higher share of local and European content. Furthermore, in most European countries, the share of national works within EU catalogs remains low, with content from other European countries like Spain, France, and Germany circulating more widely.

Maria Valenzuela, Senior Media Executive, offered a nuanced perspective on the impact of these changes, particularly concerning quotas and investment obligations set by the Audiovisual Media Services Directive (AVMSD). Wearing "lots of hats," including that of a producer, Valenzuela expressed satisfaction with the significant investment in Spain. "I'm very happy to have such a big investment in Spain. I think it does work really well because it creates an industry," she stated, subtly disagreeing with the notion that such investment doesn't benefit local industries. She emphasized that international players' substantial investments in production create robust industry infrastructure and wealth within a country.

Valenzuela elaborated on Spain's growing appeal as a production hub, initially due to diverse and inexpensive locations, and now for other reasons. She observed that this influx has solidified Spain's industry, making a strong case for government incentives that return value to those investing in film production.

However, from the perspective of a local platform, Valenzuela acknowledged the challenges posed by inflation, a topic discussed previously at NEM. "On inflation from the big players coming into the territory to produce that also made us have a much harder job when we were producing content," she noted. This dynamic introduces unexpected competition for local platforms.

Finally, donning her hat as a European citizen and a mother, Valenzuela expressed enthusiasm for the increased export of European culture and content. She celebrated the high volume of Spanish and broader European content on platforms, viewing it as a crucial counterweight to the hegemony of non-European culture. While not a "big quota fan," Valenzuela recognized their utility: "I know how useful they can be in order for us to put some money into storytelling from territories that would otherwise not be great storytellers. And I see that having happened in Spain."

The panel provided a stark reminder of the evolving dynamics of the European audiovisual market. As Vanda Rapti, EVP, Viaplay Select & Content Distribution at Viaplay Group, Christian Grece, Branko Čakarmiš, Strategic Adviser, POP TV, Maria Valenzuela, and Chris Marcich, CEO, Croatian Audiovisual Centre (HAVC), President, Association of European Film Agency Directors (EFAD), President, AGICOA, continued their discussions, the central question remained: Does Europe truly have the necessary conditions to succeed in this rapidly transforming audiovisual landscape? The data presented and the expert opinions shared suggest that while growth is evident, navigating the challenges posed by global digital players and ensuring the visibility of diverse European content will be critical for future success.