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Atlas of the Russian market of legal video services in 2015—2023. Results of 2019

May 2020

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Analytical Report (full version)

Atlas of the Russian market of legal video services in 2015—2023. Results of 2019
Atlas of the Russian market of legal video services in 2015—2023. Results of 2019
May 2020

Atlas of the Russian market of legal video services in 2015—2023. Results of 2019

May 2020

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J'son & Partners Consulting presents brief results of the research dedicated to the Russian market of legal video services in 2019.

 

The study introduced a new segmentation and analyzed the revenues of 68 companies, such as:

 

1. Online movie theaters (16 companies) — content aggregators that provide the ability to view videos through their own websites, applications for mobile platforms and Smart TV services. For example, ivi, Amediateka, Okko, etc.

 

2. TV channels (23 platforms) — TV broadcasters that primarily monetize their content on the Internet using a paid or advertising model (STS, Сhannel One, etc.)

 

3. Operators (11) — Pay TV operators that have implemented services for viewing paid video content in the form of VOD and on specialized websites (Rostelecom, Beeline, MTS, etc.)

 

4. Digital distribution platforms (2) — aggregators of video content that provide applications for various platforms with the ability to view content without linking to the network of a specific provider (iTunes, Google Play, etc.).

 

4. Social networks (5). Mail.ru (3 social networks), facebook.com, instagram.com.

 

5. Aggregators and information services (11 companies). Such services earn money by placing video ads on their own information resources (championat.com. afisha.ru, etc.) or aggregating videos from other sources (Yandex.Video, advertising networks, etc.).

 

Features of the calculation method used by J'son & Partners Consulting:

 

1. The study analyzed the monetary revenues received by a number of Russian legal video services from providing services to their users.

 

2. VAT was not taken into consideration while calculating.

 

3. According to the AVOD monetization model, starting from 2014, revenues are calculated before deducting commission from sellers and advertising agencies.

 

4. Advertisers are increasingly placing online video ads not only in video content. Therefore, the analysis includes advertising revenue generated from the following formats:

 

- in-stream (advertising videos are placed in online streaming video)

 

- out-stream (advertising videos are placed in advertising banners or texts).

      

5. In 2019 the analysts also started to take into consideration:

 

- Intersections of revenues from partner models (online cinemas and operators, TV channels and online cinemas, etc.);

 

- A number of concepts for determining subscribers of video services, users who buy or rent such content.

 

6. For the first time in Russia, both free and paid video services’ subscriber base sizes have been calculated.

 

Brief results

 

The total revenue from providing legal video services in Russia in 2019 amounted to 41.2 billion rubles (without VAT). The market grew by 65.7%. The total 2019 revenue has been calculated taking into account various revenue intersections due to partnerships between different players.

 

The legal video industry in Russia is growing in monetary terms. In 2016 the growth was 32% compared to 2015, in 2017 it was 42%, in 2018 it was 56%, and in 2019 it was 65.7%. Thanks to this and the stability of the exchange rate, Russia has increased its share in the global legal video market, which amounted to 0.7% in 2019.

 

Russian market of legal video services, billion rubles, 2014-2023

 

In 2019, the advertising model showed an increase of 60.1%, all paid models grew by 73.2% compared to 2018. Main factors affecting the market in 2019:

 

1. Strengthening of Russian Internet giants’ positions (first of all Yandex and Mail.ru). The launch of the Yandex.Plus subscription and increased monetization due to video ads for the audience of social networks. The increasing demand on the subscription model. After SVOD revenue grew by 110% in 2018, the dynamics even accelerated in 2019 and reached 116%.

 

2. The growth of out-stream advertising by 87% in 2019, primarily in social networks.

 

3. Revenue growth rates by segment (2019 compared to 2018):

 

- Operators — 26%.

     

- Digital distribution platforms — 22%.

      

- Social networks — 66%.

      

- Aggregators and information services — 88%.

 

4. Online cinemas — 87%. There have been some changes in accounting players. The Premier/List video service is now counted in the "Online cinemas" segment, rather than "TV Channels" as previously.

 

5. TV channels — 14% (see the comment above).

 

In addition to the factors appeared in 2019, in order to make a forecast of the market development for the near future, the authors have also taken into consideration the impact of the following events that occurred in February and March 2020:

 

1. The coronavirus pandemic. Such a long-term isolation of a large number of people inside of their homes has led to a sharp increase in demand for legal video. According to online movie theaters and operators, the average daily number of views for the period between January and March 2020 was equal to the peak values of the first January week (long New Year holidays) in a normal year. This high demand should lead to faster growth in revenue from subscription and transaction models in 2020.

 

2. The economic crisis that began in March 2020 may lead to a significant (up to 15%) drop in advertising revenue on TV (and as a result, TV channels’ revenues as a whole) and a slowdown in the activity of advertisers in online video advertising.

 

Taking into account all the factors that will affect the development of the market, the forecast for the period 2020—2023 looks like this (see figure 2). In 2020, the share of the AVOD model will already be less than 50%.

 

Structure of the legal video market in Russia by monetization model, 2018-2023

 

The key trends in the development of the Russian market of legal video services in the near future are:

 

- Successful use of online video services as part of the ecosystems of large holdings.

 

- Growing audience amongst mobile device users.

 

- Development of the vertical video format.

 

- Revenue growth from various paid monetization models.

 

- Revenue growth from the out-stream ad format.

 

- Cooperation between Pay TV operators, online cinemas, TV channels, and social networks.

 

- Content produced by video services themselves.

 

- Increasing the volume of 4K content

 

___________________

 

This information note was prepared by the J'son & Partners Consulting. We work hard to provide factual and prognostic data that fully reflect the situation and available at the time of release. J'son & Partners Consulting reserves the right to revise the data after publication of new official information by individual players. 

 

Copyright © 2020, J'son & Partners Consulting. The media can use the text, graphics and data contained in this market review only using a link to the source of information - J'son & Partners Consulting or with an active link to the JSON.TV portal

 

™ J'son & Partners [registered trademark] 

 

Detailed results of the study presented in the full version of the report

 

“Atlas of the Russian market of legal video services in 2015—2023. Results of 2019".

 

SUMMARY OF THE STUDY

1. RESEARCH METHODOLOGY

2. GLOBAL VIDEO SERVICES MARKET. KEY INDICATORS 2016—2024.

2.1. KEY INDICATORS OF THE GLOBAL VIDEO SERVICES MARKET

2.2. OVERVIEW OF THE GLOBAL LEGAL VIDEO MARKET IN 2019

2.2.1. Online cinemas

2.2.2. Telecom operators

2.2.3. TV Channels

2.2.4. Vendors

2.2.5. Social media

2.2.6. Digital distribution platforms

2.2.7. Summary data on revenue and number of video service subscribers

2.3. KEY PLAYERS IN THE GLOBAL VIDEO SERVICES MARKET.

2.4. AUDIENCE OF VIDEO SERVICES IN THE WORLD

  1.  THE RUSSIAN MARKET OF LEGAL VIDEO SERVICES

3.1. KEY EVENTS IN THE RUSSIAN MARKET IN 2019

3.2. QUANTITATIVE INDICATORS, MARKET STRUCTURE BY BUSINESS MODELS, 2014—2023.

3.3. MARKET STRUCTURE IN 2019 BY SEGMENTS.

3.3.1. Online cinemas

3.3.2. Social networks

3.3.3. TV Channels

3.3.4. Operators

3.3.5. Aggregators and information services

3.3.6. Digital distribution platforms

3.4. AUDIENCE OF LEGAL VIDEO SERVICES IN RUSSIA

3.4.1. Viewers of legal video services in Russia

3.4.2. Coverage, views and paid users of legal video services.

3.5. CONTENT OF LEGAL VIDEO SERVICES

3.5.1. Online cinemas

3.5.2. Operators

3.5.3. Digital distribution platforms

3.5.4. Aggregators and information services

3.5.5. Features of content of legal video services in Russia

3.6. REGULATION OF THE MARKET

3.7. KEY TRENDS IN THE DEVELOPMENT OF THE LEGAL VIDEO SERVICES MARKET IN RUSSIA

CONCLUSION

List of figures

Fig. 1. Russian market of legal video services, billion rubles, 2014-2023

Fig. 2. Structure of the legal video market in Russia by monetization models, 2018-2023

Fig. 3. Scheme of legal video content distribution. The subject of the research

Fig. 4. Methodology for estimating revenue from the AVOD model

Fig. 5. Global market of legal video services, billion dollars, 2016-2024

Fig. 6. Global market of legal video services by monetization models, billion dollars, 2016-2024

Fig. 7. Structure of the global video services market by monetization models, %, 2016-2024

Fig. 8. SVOD subscriber base, thousand subscribers, 2017-2024

Fig. 9. SVOD subscriber base structure by players, 2024, million subscribers and %

Fig. 10. Investment in own or purchased content, not including sports broadcast costs, million dollars

Fig. 11. Impact of the launch of the Disney+ video service on Netflix

Fig. 12. Number of Netflix video products, 2002-2019

Fig. 13. PTV subscribers connected to Netflix via set-top boxes, 2019, million subscribers

Fig. 14. Disney+ app downloads by countries

Fig. 15. Disney+: number of app downloads and total viewing hours

Fig. 16. Facebook's Portal TV device

Fig. 17. Video viewing sources

Fig. 18. Video viewing devices: the most popular ones

Fig. 19. Frequency of using devices for video viewing

Fig. 20. Video audience in social networks

Fig. 21. What content viewers want to see live

Fig. 22. Video audience in social networks: device preferences

Fig. 23. Preferences for using video viewing platforms

Fig. 24. Buying video content

Fig. 25. Genre preferences of video content viewers

Fig. 26. Sberbank services ecosystem, 2018

Fig. 27. Russian market of legal video services, billion rubles, 2014-2023

Fig. 27. Structure of the legal video market in Russia by monetization models, 2018-2023

Fig. 29. Structure of the legal video services market by holdings, 2019

Fig. 30. Distribution of AVOD revenue by video ad placement method, 2018-2019

Fig. 31. Companies’ shares in the total revenue received under the AVOD monetization model, %, 2019

Fig. 32. Companies’ shares in the total revenue received from all paid monetization models, %, 2019

Fig. 33. Companies’ shares in the total revenue received under the SVOD monetization model, %, 2019

Fig. 34. Companies’ shares in the total revenue received under the TVOD monetization model, %, 2019

Fig. 35. Companies’ shares in the total revenue received under the EST monetization model, %, 2019

Fig. 36. Structure of revenue of the legal video services market by segments, 2018-2019

Fig. 37. Structure of revenue of the legal video services market by delivery platforms, 2018-2019

Fig. 38. Various players’ market shares in the online cinema segment by total revenue, 2019

Fig. 39. Structure of revenue of the online cinema market segment by content delivery platforms, 2018-2019

Fig. 40. Structure of revenue of online cinemas by monetization models, million rubles, 2019-2023

Fig. 41. Structure of social networks’ AVOD revenue by formats, 2018-2019

Fig. 42. Forecast of social networks’ revenues from legal video services, million rubles, 2019-2023

Fig. 43. Market shares of TV holdings in the TV Channels segment by total revenue, 2019

Fig. 44. Forecast of revenue of TV channels by monetization models, million rubles, 2019-2023

Fig. 45. Various players’ market shares by total revenue in the operator segment, 2019.

Fig. 46. MTS Media’s development strategy until 2024.

Fig. 47. Structure of operators’ revenues by monetization models, million rubles, 2019-2023

Fig. 48. Structure of AVOD revenue of aggregators and information services by formats, 2018-2019.

Fig. 49. Forecast of aggregators and information services’ revenues from legal video services, million rubles, 2019-2023

Fig. 50. Structure of digital distribution platforms’ revenues by monetization models, mln rubles, 2019-2023

Fig. 51. Internet Penetration in Russia, % of the population, December 2019

Fig. 52. Internet Penetration on various devices in Russia, % of the population, 2019

Fig. 53. Frequency of professional video content viewing

Fig. 54. Duration of professional video content viewing

Fig. 55. Willingness to pay for video content

Fig. 56. Attitude to paid content and subscriptions

Fig. 57. Structure of Internet users by source of professional video viewing, 2017-2019

Fig. 58. Devices for viewing professional video online

Fig. 59. Type of professional video viewing online

Fig. 60. Netflix. Revenue and cost dynamics, billion dollars, 2012-2018

List of tables

Table 1. Marketing and technological classification of TV

Table 2. Distinctive features of monetization models of legal video services

Table 3. Subscription fee for individual channels on the Prime Video Channels platform

Table 4. Prices of subscription to the most popular video services

Table 5. Revenue and subscriber base of global video services in 2019

Table 6. Factors influencing the choice of video content

Table 7. Market revenues by monetization models, million rubles, 2019-2023

Table 8. Top 15 product categories in in-stream advertising, 2019

Table 9. Top 15 product categories in out-stream advertising, 2019

Table 10. Top 10 advertisers in in-stream advertising, 2019

Table 11. Top 10 advertisers in out-stream advertising, 2019

Table 12. Number of companies mentioned in the study, 2017-2019

Table 13. Demand on genres among viewers of professional online videos

Table 14. Awareness of video services in Russia, 2017-2019

Table 15. Frequency of viewing video services in Russia, December 2019

Table 16. Number and duration of views, 2019

Table 17. Average monthly coverage of video services, 2019

Table 18. Average monthly number of paid users with a single payment, 2019

Table 19. Number of subscribers of online cinema content in Russia as of 31.12.2019

Table 20. Number of subscribers of VOD services of operators, TV channels, and aggregators in Russia as of 31.12.2019

Table 21. Sports in Russian online video services, 2019

Table 22. Content of paid online cinemas, 2019

Table 23. Content of mixed online cinemas, 2019

Table 24. Top 10 public posts in vk.com with cinematic content, 2020

Table 25. Top 10 Russian-language YouTube channels, March 2020

Table 26. Content of operators providing video services, 2019

Table 27. Structure of video libraries of Russian video services by formats, %, 2019

Table 28. Structure of video libraries by producer countries,%, 2019

Table 29. Structure of video libraries by content type, %, 2019