The growing digital media consumption around the globe clearly indicates the decline of linear television and a looming paradigm shift in the role of video in people’s lives. Broadcasters are becoming increasingly digital and mobile, while consumers are becoming more discerning and conscious.

This trend is hardly a surprise, but certain regions like the Nordics register exceptional levels of growth and definitely deserve a closer look. Finland, Denmark, Sweden, Iceland and Norway (collectively referred to as the Nordics in the remaining part of this post) share many characteristics which sensibly allow to analyse these countries in terms of video industry trends.

Linear Television in Decline

A survey carried out in 2017 showed that 62 per cent of Norwegians watched the traditional, linear TV – down from 67 per cent the year before. In the age groups 9-15 and 67-79 viewing linear television remains unaffected by the new media trends, while it is decreasing among the young adults aged 16-24 and other age groups.

At the same time, eMarketer forecasts U.S. over-the-top video viewers will top 193 million by 2021, which equates to 57.3% of the population of the Nordics.

Why Nordics Matter

Nordics are avid adopters of advanced technology, which places them (i.e. Denmark, Sweden and Finland) on top of the list of the best performing countries in digitisation. This is confirmed by DESI, the Digital Economy and Society Index, which summarises relevant indicators like connectivity, the use of internet services and integration of digital technology. It serves as a litmus test of the evolution of EU member states in terms of digital competitiveness. Although Norway, as a non-EU member, did not make the DESI list, it reports similarly high ratings, and deserves a mention along with the other neighbouring Nordic countries.

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The Impact of Broadband

The popularity of streaming video in the Nordics stems primarily from the availability and popularity of fast, reliable broadband internet, and its universal coverage across the countries. Statistics show that Norway, Denmark and Sweden are the hotbeds of active Internet users.

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Just like in other parts of Europe, high-speed broadband is still gaining popularity in the Nordics (i.e. Finland, Denmark, Sweden, Iceland and Norway) bridging the technological gap between urban and suburban areas. Parallelly, however, Nordics report a steady growth in mobile data traffic, even in urban and otherwise well-connected areas. As data plans are becoming cheaper and cheaper, more people are adopting the devices for daily media consumption and video streaming while on the go. However, according to a Nordic telecom report, there are certain smaller differences between the countries.

People in the Nordics basically live and breathe the Internet – these countries report the highest connectivity index of all Europe. The trend, naturally, translates to rich media consumption habits: listening to music, playing games and watching videos: video on demand, news online and social networks.

Internet in the Nordics, unlike in many other countries in the EU, is not the preserve of young, affluent people from big cities. Good country-wide connectivity means lower digital exclusion and a higher proportion of older internet users with disposable income.

Significant Increase in the Use of Streaming Services

The number of Norwegians listening to audio media daily doubled from 26 per cent in 2016 to 50 per cent in 2017. This means that seven in ten people listened to various audio files (podcasts, music, etc.) streamed from the Internet, preferably using a mobile phone. In 2017, nearly four of ten Norwegians (37 per cent) claimed to watch video content on a daily basis, including content from various streaming video services (SVOD) and streamed archive programmes.

The Nordicom report also reveals that among the 16-24-year-olds, 75% of Nordic viewers watched content from SVOD services on an average day. Danish media consumption is on the rise, and the smartphone remains the main device not only for Internet browsing, but increasingly for streaming.

Netflix

The Nordics clearly dominate video consumption trends, but the typical consumption habits and preferred streaming platforms are not the same as in other European countries. For example, Netflix’s market share in the Nordics is just over 49%, compared to almost 71% in other parts of Europe. Instead, various Nordic providers, although smaller individually, platforms like Viaplay, TV2Play, C More and localized versions of HBO jointly account for most streaming service subscriptions in the Nordics. The only other markets in Western Europe where Netflix doesn’t dominate are Germany, Italy, and Spain.

Subscription Fatigue

Subscription fatigue is likely to hit when more VOD platforms launch. Statistics bode well for subscription services, with video at the forefront. In light of concerns over the looming tipping point in media known as ‘subscription fatigue’, services like Netflix are on the safe side. The frustration associated with the growing number of streaming services people need to pay for is more likely to affect news than video content. A survey showed that people, when asked to cancel some of their media subscriptions for the 12 months said they would rather drop news, and keep a video streaming service instead.

A mere 12% said they would keep a news subscription, and nearly one-third (31%) would pick nothing (no news and no video platform subscription).

Summary

The Nordics are clearly leading the charge in broadly understood digital media in Europe, and the statistics on the use of video media just confirm it. This situation presents endless possibilities. Growing demand for video has never been higher in the Nordics, and is becoming a very important source of business opportunity. The technology and demand are already there. What’s needed is new, sustainable business models coupled with competence and a good understanding of the market to properly leverage innovation in tech.