Linear TV subscriptions drove growth for European media companies in the first quarter of 2023, with French giant Vivendi and Nordic group Viaplay reporting rising revenues, even in the face of prevailing economic pressures.
Vivendi’s pay-TV outfit Canal+ saw 2.2 percent YOY growth, bringing in €1,478 million for its parent company, whose total revenues climbed 3.3 percent to reach €2.29 billion. Subscriptions at Canal+ drove a 1.4 percent increase in domestic revenues, while international operations were up by 1.6 percent (but down 0.3 percent at constant currency).
Viaplay’s earnings told a similar story, with domestic revenues climbing 36 percent in the first quarter. Linear subscriptions drove that growth again, with revenues up 11 percent (though this also reflects rising subscription fees).
The advertising business was less successful, according to the Viaplay results, dropping 2 percent as linear ad budgets continue being squeezed. The company noted the decline was “better than expected in weak markets,” and raised TV prices in upfront contract negotiations. Nonetheless, the ad market is not likely to bounce back anytime soon, “with the outlook for H2 currently particularly uncertain.”
Going global
Both companies are also pursuing international strategies and diversifying their offerings. Viaplay launched its streaming service in the UK, US and Canada, reporting a sevenfold increase in international revenues. Viaplay added 325,000 subscribers during the quarter, a 60 percent increase on Q1 2022. And the company has a signed series of content deals through its Viaplay Select partnerships, bringing its programming to streaming services in international markets, including Canal+ in Austria.
Meanwhile Canal+ has announced a multi-year deal with Apple TV+, bundling all the SVOD service’s content for subscribers in France and Switzerland, soon to be rolled out for Czech Republic and Slovakia. In addition, Canal+ has signed a deal with French telco Orange to acquire pay-TV unit OCS and production arm Orange Studio.
This is significant given the importance of the production business to Vivendi’s operations. Its production and distribution arm Studiocanal witnessed 13.6 percent revenue growth in Q1, driven by domestic releases such as Alibi.com 2, and international hits like John Wick 4.
And though Vivendi lost its remaining stake in Mediaset España to Silvio Berlusconi’s MFE, the company’s numerous assets have picked up the slack, including 14 percent growth at gaming wing Gameloft and 3.3 percent at advertising firm Havas. However, the proposed takeover of publishing giant Lagardère remains in the hands of EU regulators, with a final decision due in June. “We have submitted proposed remedies to the European Commission and are now awaiting its decision,” the company said.
