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Do European Broadcasters Still Have Home Advantage for Producing Local Content?

Tim Cross 10 January, 2022 

Last year saw an uptick in commissioning activity from European broadcasters, as they looked to strengthen their content offering in the face of ever-growing competition from international streaming services.

Research from Ampere Analysis found that ITV commissioned 60 new shows in the first half of 2021, compared with 31 in the same period for 2019. RTL more than doubled its commissions over the same timeframe, from 42 in the first half of 2019 to 90 in the first half of 2021.

In part, this has been a necessary reaction to US broadcasters and media companies locking their content within their own international streaming services. Businesses which European broadcasters could previously rely on as sources of quality content are now less willing to license their shows abroad. Even if a US media company hasn’t yet launched its streaming service, it may be wary of committing to long licensing deals which could scupper a European launch further down the line.

But the increase in commissioning also represents an effort for Euro broadcasters to fight against their international competitors through investing in what they know best – local content.

Local content has long been seen as an ace in the hand for European broadcasters. While the likes of Netflix, Disney+ and Amazon Prime Video have built big audiences around the globe with US-centric content, broadcasters know their own markets better than the US streaming giants ever will.

RTL for example talks of creating ‘local champions’ in streaming, which each cater to their specific markets based upon decades of experience in local production and commissioning. 

Nordic Entertainment Group is going a step further with its Viaplay streaming service. NENT sees an opportunity to use its specialism in local content not just to service audiences in Nordic countries, but also to export this content internationally.

BritBox, a joint venture created by the BBC and ITV, used the same logic in reverse; serving British content firstly to Americans, before launching the service at home as well.

Does home advantage still count?

This received wisdom around broadcasters’ home advantage has been challenged over the past year or so. Commissioning local content in international markets has been a focus for Netflix for years now, and the streamer seems at a glance to be becoming quite adept at the process.

The recent success of Korean drama Squid Game, Netflix’s most popular ever TV show, is the most obvious example. But it’s not the only one. French detective thriller Lupin and Spanish heist drama La Casa de Papel are both also counted in Netflix’s top ten most popular shows within 28 days of release (judging by each show’s most popular season).

This is likely to be an ongoing trend, as Netflix continues to invest heavily in overseas content. And other streaming services are likely to take a similar approach too.

“As SVOD platforms continue to diversify their content offerings targeting different markets, we’re likely to see more and more partnerships with local production companies and independent production companies,” says Lottie Towler, research manager at Ampere Analysis. 

The success of Netflix’s local strategy can be overstated. It’s important to remember that a lot of the popularity of the aforementioned shows has come from Netflix’s core US market.

El Casa de Papel, known in English speaking countries as Money Heist, originally ran on Spanish TV. But after a strong start, the series’ viewership fell from over four million for the pilot to under two million for the fifteenth episode.

Squid Game meanwhile drew much more mixed reviews at home than it did abroad, according to Vanity Fair. Korean critic Kim Seong-so commented that Squid Game likely felt more fresh to US audiences than to Koreans, who were more familiar with the themes and tropes played out in the show.

That’s not to say Squid Game wasn’t popular in South Korea – it was the most watched show in the country for four weeks running. But this was also true of the US – while in Spain the show topped the charts for seven weeks in a row. Squid Game’s success wasn’t that Netflix made a drama which appealed massively to Korean audiences, but rather that Netflix made a Korean drama which appealed to audiences worldwide.

A mixed picture in Europe

So is the success of Netflix’s international strategy overstated? That’s not necessarily true either. Netflix has been successful – just not necessarily with the shows that have resonated globally.

After Squid Game dropped off the number one spot in Korea it was replaced by My Hometown Cha-Cha-Cha, another Korean production. Since then, My Name, The King’s Affection, Hellbound, The Hungry and the Hairy, and The Silent Sea have held the top spot, all of which are Korean language shows and three of which are Netflix originals.

In Europe however the picture is more mixed. In the last half a year, Spanish Netflix original TV series have topped the charts in Spain for 10 out of 26 weeks. In Italy only one Italian language show has taken the top spot in the past half year, despite six Italian series being released over this period.

Ampere Analysis’ research suggests that this strategy still is important for all streaming services, not just Netflix, and makes sense in the long run.

“Companies are able to grow their subscriber base by investing in local content,” says Minal Modha, principal analyst at Ampere. “Although there is high engagement with Hollywood movies, there is even higher engagement with local TV shows and films.”

Ampere’s data drawn from Italy and Japan found that 16 percent of consumers say they watch US-produced TV shows “very often”, compared to 41 percent for local content.

An opportunity for broadcasters

So Netflix has proven itself able to produce quality local content for international markets. But the streaming giant also can’t quickly churn out a catalogue of local hits in a multitude of different countries. Results from its investments abroad have been mixed – more mixed than the success of Squid Games and Lupin might suggest.


About the Author:

Tim Cross is Assistant Editor at VideoWeek.
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