Market Insight

New OTT proposition from NTV-Plus hits Russian online video market

November 01, 2016  | Subscribers Only

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NTV Plus has launched a new over-the-top  (OTT) subscription video on demand (SVoD) service called NTV-Plus Kino. The service comes in addition to existing online video propositions from the company; a multiscreen offering and another online service offering sport broadcasts.

NTV-Plus Kino currently offers around 100 locally produced television series to its subscribers. Additional series are planned for addition in the future, as well a gradual introduction of a broad variety of TV and film content.

The service is available for subscription by anyone, with no requirement of being an existing client of NTV Plus. Weekly subscriptions are priced at 99 RUB ($1.6), and monthly at 299 RUB ($4.7). Individual episodes can also be purchased for 29 RUB ($0.5) each. Payment methods include bank cards, carrier billing, or billing through local internet payment platforms.

Our analysis

Gazprom-Media, the holding company of NTV-Plus, has already made an attempt at establishing a paid subscription service in the past, having launched in 2011. The service was initially priced at around $17 per month, but over time the company gradually lowered the fee  to nearly half that amount. Following two years of operating the paid subscription model, supplemented the revenue stream with advertisement in 2013. Results showed that the ad-funded model was five times more profitable  than the original subscription model and by May 2015 the company had reversed the initial strategy offering virtually no paid for content.

NTV-Plus Kino costs less than the launch price of, but the service has nevertheless chosen to adopt the paid subscription model that has proven unsuccessful before. The introduction of the service therefore importantly indicates that NTV-Plus believes that the market has matured to the point where subscription models are a viable option for online video services. IHS believes the reason why subscription methods have proven unsuccessful in the past, was due to consumer’s purchasing behaviour being conditioned by the widespread availability of illegal video sources online, and thus were hesitant to pay. This, however, is slowly changing across the globe, as consumers recognise the convenience  that some paid online services have to offer.

The selection of content on NTV-Plus Kino differs from what is currently offered on an ad-funded basis in the market – having comprehensive coverage of the most popular domestically produced television series over the past two decades, as well as brand new series. The given library has likely required a smaller monetary investment on content acquisition from NTV-Plus’s side, when compared to the library of in 2011, which offered a more extensive catalogue. This move reduces associated monetary risk, in case the subscription model proves to be unsuccessful once again. At a 99 RUB subscription price per week, IHS believes NTV-Plus Kino may find a sizeable addressable market in a culture where to this day television content plays an important part in the lives of the population.

NTV Plus
Research by Market
Media & Advertising
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