Nordic Entertainment Group (NENT) has announced on its Capital Markets Day that it will launch its Viaplay streaming service in five new markets by the end of 2023. It has raised its Viaplay subscriber target to approximately 12 million by the end of 2025 from around 10.5 million, too. Some 6 million Viaplay subscribers are now expected to be in international markets, up from the original target of approximately 4.5 million.
NENT said it intends to start offering Viaplay in the UK in the second half of 2022 and then in Canada, Germany, Austria and Switzerland during 2023. Viaplay will then be operating in sixteen countries, up from the original target of fifteen announced in November 2020.
At launch, Viaplay’s offering in the five new markets will comprise Nordic, local and international serials, films, documentaries and children’s content, both original and acquired. NENT may also add selected sports rights to the Viaplay range in future for some of the new European territories. Viaplay will be available in the new markets on a direct-to-consumer basis, as well as through partnerships with local distributors.
Viaplay’s accelerated expansion, alongside recent launches in Estonia, Latvia, Lithuania and Poland, and forthcoming starts in the US and the Netherlands, is now expected to contribute to group compound annual organic sales growth in 2020-2025 at the upper end of the 18-20 percent target range declared earlier.
The positive trend in NENT’s Nordic operations is predicted to lead to compound annual organic sales growth in 2020-2025 at the upper end of the 13-15 percent target range stated previously, with Viaplay having CAGR of approximately 23-25 percent in the Nordic region in that period. The Nordic operations are expected to have a significantly higher EBIT margin of approximately 15 percent in 2025, and a long-term 20 percent margin potential.
NENT said its international operations are still expected to make a positive EBIT contribution in 2025, and are now forecast to have an EBIT margin of approximately 15 percent in 2026, with a long-term 25 percent margin potential. Total accumulated losses to breakeven for the international operations are likely to be approximately SEK 3.8 billion. NENT said its expansion is fully funded after the SEK 4.35 billion equity raising in February 2021.
Anders Jensen, NENT Group president and CEO, said Viaplay will account for more than half of group revenues "in a couple of years' time". He added that NENT takes an open approach to partnering that ensures Viaplay is available as broadly as possible.
Germany’s SVoD penetration among its 42 million households is expected to exceed 50 percent in 2025, with more than two subscriptions per SVoD household. NENT said 77 percent of the UK’s 28 million households have SVoD subscriptions, and this is set to rise. In Canada, 80 percent of Canada’s 15 million households currently have a video streaming subscription and the number of subscriptions per SVoD household should rise to almost three in 2025. Switzerland and Austria have 4 million households each and 48 percent and 39 percent SVOD penetration rates, respectively, which are expected to grow in the coming years.
