Fi, PuhuTV, BluTV and Originals content

One of the most popular local TV series of this season on Turkish TV industry was ‘Fi‘. It was simply a drama but also unique due to a number of reasons. First of all, it was a series available ONLY online as a OTT content but not broadcasted in the classical sense.  Even though this is quite common in US like examples of many Netflix Originals, it’s quite rare that a TV series with a remarkable budget level like ‘Fi’ is not broadcasted all over Turkey but only available through a OTT service.

At this point, I’d better give a quick background information about the service that owns ‘Fi’. The OTT service is called PuhuTV. It’s backed by a major broadcaster group in Turkey, Dogus Media. PuhuTV has been launched commercially early this year as a free-of-charge, ad-based catchup TV service hosting major TV series from a variety of channels. In order to create an awareness in the market and make some noise, they’ve made a sensational launch for their first and for the time being only ‘Originals‘ content Fi. As there is no Live TV channel offering on PuhuTV, the commercial launch event has been publicly available on YouTube TV. At launch night, the first 3 episodes of Fi has been released. As a matter of fact, producing original content like Netflix or Amazon Prime Video is doing in US is already done before by BluTV which is another OTT service. BluTV is owned by one of theTurkey’s major TV broadcaster Dogan Holding. As of today, there are 3 original, exclusive content on BluTV. On top of these, Netflix Turkey is also working on a brand-new local Originals nowadays specific for Turkish market.

Coming back to the popular TV series Fi, it was not made available all at once, but along a series of weeks unlike the Netflix /Amazon Originals. Typically all the episodes of a OTT type of TV series’ new season are made online on the commercial date which is announced earlier. Then, audiences are looking forward the launch date and watching many episodes in a row once they are available. (i.e. Game of Thrones of HBO, House of Cards of Netflix) Unlike the typical scenario, even though the first 3 episodes of Fi have been made available online in April at the launch event, Fi fans had to wait another few weeks in order to watch the remaining episodes. PuhuTV had relased remaining episodes one by one every week. Eventually, the last episode was online on 16th of June as the season final. I’ve thought about the reason whyPuhuTV management decided to release the episodes over the course of 2-3 months instead of making the complete set of episodes of Fi made online at once,

Even though BluTV and PuhuTV are similar OTT services there is a significant difference between them. While BluTV is a subscription based service, PuhuTV is a free-of-charge, ad-based service. That’s why PuhuTV had to wait the rating results of the first 3 episodes. The result was really impressive. According to the results that has been shared, the first 3 episodes have been watched a total of 3,5 million views within the first 50 hours. For the advertisement agencies, this is the most critical KPI that they care. That’s why PuhuTV management should have first waited to get these results in order to convince the advertisers more easily.  Following the fascinating results of the first 3 episodes which were basically missing ads, we’ve seen many ads as in the form of product placement (embedded into to the content in a relatively natural way). Actually, for a service that is free-of-charge the audiences are more tolerant to ads.

It remains to be seen if this ad-based model will be sustainable in Turkish market. By nature, Turkish TV sector is quite competetive and dominated by more than 500 FTA channels broadcasting  via satellite with a country-wide penetration of more than 70 percent.

 

Tivibu continues its growth trend.

Turk Telekom Group announced 2016 year end financial results. You can see them at this link. Regarding the interest of this blog, let’s have a look to the Tivibu figures.

According to the regulatory body’s official figures, as of Q3 of 2016, Tivibu has a total of 589K subscribers. (428K IPTV customers and 161K DTH customers. )

TT announced a total of 677 subscribers at the end of Q4 2016. We don’t have yet the split of this number but most probably the majority of the net additions comes from satellite domain.

Tivibu customer base was kind of stucked before the launch of satelllite service at the Q3 of 2015. Since then Tivibu gained a momentum and has reached more than 2 million subs including the OTT customers. DTH service allowed TT to provide the DTH service to any household with a satellite dish. Satellite is the most common delivery method of Digital TV services in Turkey.

2016 on turkishtvmarket.info

This marks the end of the 3rd year of my dear blog turkishtvmarket.info 🙂 As a kind of tradition, I list down the most popular posts of the year. Herebelow you’ll see the most read top 10 posts of 2016 in order.

2014 on turkishtvmarket.info

2015 on turkishtvmarket.info

 

Dogus Group launched puhutv

In Turkey, there are a number of OTT services. Most of them are owned by Pay-TV operator while there are also a few independent OTT services. To name a few:

  • Digiturk Play: Digiturk’s OTT service ( 60+ Live TV channels & hundreds of VOD titles ) Obviously Football League content is the main driver.
  • Tivibu Go: Turk Telekom’s OTT service( 100+ Live TV channels & hundreds of VOD titles ) TT group’s main focus is growing the customer base through fixed broadband.
  • Turkcell TV+:  Turkcell’s OTT service ( 100+ Live TV channels & hundreds of VOD titles ) Turkcell group’s main focus is growing the customer base through mobile broadband thanks to the advanced LTE infrastucture.
  • BluTV: D-Smart’s OTT service ( 27 Live TV channels & hundreds of VOD titles ) Dogan Group that owns the D-Smart also owns Kanal D FTA Channel. BluTV is trying to differentiate by the catchup TV content of Kanal D groupwithout ads (the content is in fact available on Kanal D website www,kanald.com.tr with ads) as they own the rights exclusively.
  • KabloWebTV: KabloTV’s (formerly Teledunya) OTT service. While all the mentioned services are available to anybody ( i.e. all access) without an existing subscription to the associated service provider, KabloWebTV is only available to Kablo TV customers.

In addition to these operator backed up OTT services, there are also a number of independent OTT services. The most well-known of these is apparently Netflix. Other major OTT services are Filmbox Live (http://www.filmboxlive.com/tr), and Mubi (https://mubi.com)

There is a common point on all of these services. Their business model is based on subscription. They don’t show any ads.

screen-shot-2016-12-13-at-23-45-52

 

In addition to these services, there was one free service called tvyo (http://www.tvyo.com/) based on ad-revenue. Dogus Media who owns a number of popular FTA Channels such as Star TV, NTV, NTV Spor and Kral TV was behind the service. Lately, Dogus Group has launch a new version of tvyo called as puhutv.(https://puhutv.com/) It’s currenly in beta stage. It’s basically a free of charge service hosting catch-up TV versions of  popular TV series of Dogus Group Channels both new ones and old ones as well as old Turkish movies.

Overall puhutv is a new generation version of tvyo that is trying to leverage on Live TV content and generate a significant amount of traffic due to popular series it owns. Once the traffic arrives to a certain level then Dogus Group will generate revenue through ads. Considering the characteristics of Turkish TV audience (fan of 2 hours long TV series, a very high percantage of piracy, low income level etc. ) this ad-based business model seems to have to most possible chance to monetize in OTT domain. Apart from the OTT services of Pay-TV operators , there is no independent OTT provider including Netflix that has been very successfull in Turkish TV Market. We’ll see if the model of puhutv will work.

Turkcell Superonline celebretes 1 million Broadband & TV+ customers

Turkcell Superonline fiber internet service and Turkcell TV+ service have both surpassed 1 million subscriber threshold. The homepass for fiber broadband service is 2,6 million households now in 15 cities out of 81 cities in Turkey.

In order to celebrate this milestone, during December 2016 Turkcell will be upgrading the broadband speed of all the customers to 100 Mbps bandwidth. Similarly, Turkcell TV+ users will be authorized to watch all the channels independently form their content package within December. You can watch the press release video here. (in Turkish)

screen-shot-2016-11-27-at-21-26-08

Turkcell’s multiscreen TV platformu  Turkcell TV+ has reached 1 million customers as the end of October. Thanks to the 4.5 technology the average watching time on mobile clients has reached to 28 minutes per day.  The total download of the mobile Android and iOS clients already reached to 2.5 million. Premier League and NBA official broadcaster Turkcell TV+ is also delivering 2 4K Ultra HD Live TV channes together with the brand new 4K STBs.

100 thousand customers with a single invoice

Turkcell is offering a special bundle package that includes a complete set of solutions. It has 50 Mbps limitless internet (with a 125 GB fair usage quota) 4 GB mobile broadband, 500 minutes voice, 1000 SMS, and Turkcell TV+ offer, This complete package only costs 99 TRY. This package already had 100K subscribers in quite short time.

Netflix Turkey Launch Aftermath

Netflix has launched its service in Turkey together with localized UI and dubbing/subtitle support in 21th of September.  Netflix CEO Reed Hastings was himself also present at the launch event. Webrazzi, a local techno portal has made an interview with him, you can watch it here.

Together with this launch the importance of localisation has been validated to be key one more time. As a matter of fact, Netflix is accessible from Turkey since January 2016 just like the rest of the world. Nevertheless, the ranking of the download of Netflix app has been decreased to more than 500th row around the beg of the year. Then, on Sept, the UI of Netflix has become available also in Turkish, 80% of the catalog has been Turkish subtitled if not dubbed, Finally the cost of service has slightly decreased and the currency of payment has been changed to Turkish Lira from Euro. Following these 3 major changes, the iPad app download ranking has boosted from 500+ to top 50 as seen on the graph below.

57ffe953dd0895e3338b4adb-425

On the other hand, one of the most debated topics was how widely is Netflix content available in Turkey. Let’s have a look details of this. On this link, one can see how much of percentage of the Netflix content in USA is available on various geographies of the world -while keeping content in USA as 100%.- Based on this source, one can access to 25% of the Netflix content in Turkey on TV shows space, while 10,65% of the movies content. The same ratios are around 50% in Ireland 40% in Finland and 30% in Germany. Netflix made a very sisimilarocal launch in Poland around the same time in September. In Poland, more or less the same level of content is available like Turkey.

In short, it’s a fact that Netflix Turkey could not offer the same level of content depth as Netflix USA. But still it’s not far if compared to the most of the countries in Europe. Considering, it’s simply a matter of content rights clearance I don’t see this as a blocker issue as this is core competence of Netflix. If the customer base in Turkey is growing fast, I have no doubt Netflix will continue investing here and making more more content available to Turkish audiences.

e-interview with my friend from IHS Markit

My friend Constantinos from IHS Markit made an e-interview with me. I’m now sharing the script of this interview with my readers herebelow:

What is the current state of the OTT Market in Turkey? Is it a very niche market, with no real impact on the subscribers of the Pay TV players (like Digiturk, D-Smart, Turk Telekom, Turksat)? It has a very small percentage of subscribers, let ‘say less than 1% of the Pay TV Market?

If the OTT landscape in Turkey is examined deeply it’s seen that it is mainly dominated by OTT extensions of the legacy Pay-TV operators. In other words, the majority of the OTT consumption is done by the services provided by Pay TV players, hence almost no impact on the major players. Digiturk, Turksat, TT and Turkcell are all offering their OTT services as a bonus to the main TV offering. D-Smart’s BluTV is kind of different in the sense that with the new organisation and ambition Dogan Group is trying to position BluTV as a isolated product apart from D-Smart but they are still struggling. On top of this, there are still a number of independent OTT players like Netflix, Filmbox etc but due to the lack of marketing power and brand awareness they are not that competent and hardly gain new customers. Overall, taking into account the total number of OTT users in Turkey they could arrive up to 2,6 million mainly powered by TT and Turkcell TV+ customers while the global pay-TV market in Turkey is close to 6 million.

Here are the up-to-date figures:

Tivibu GO: 1,927 million as of Q1, 2016. Reference is the link below

http://www.ttinvestorrelations.com/financial-operational-information/fact-sheet.aspx

Turkcell TV+: 679K as of April, 2016. Reference page 16 at the presentation below.

http://s1.turkcell.com.tr/hakkimizda/en/yatirimciiliskileri/InvestorPresentationLibrary/Turkcell-Investor-Presentation-June-2016.pdf

If you add just the OTT subs of Tivibu GO and Turkcell TV+, it makes almost 2,6 million. The next question is how active are these people, what is average amount of time they spend on OTT services etc. 

· Both Turk Telekom (Tivibu Web) and D-Smart (BluTV) have launched standalone OTT services (I mean OTT services offered outside of their Pay TV subscribers’ base, offered to anyone interested without having to be a subscriber). Do you see Digiturk launching something similar in the near term, before the end of 2016?

Actually Digiturk already has such a OTT only service called Digiturk Play to which anybody without any Set-top-box could login to. 

There are mainly 3 packages:

– free package

– cinema package: 4,99 TL (9,99 TL if you’d like to watch also on Smart TV)

– premium package: 12,99 TLm (19,99 TL if you’d like to watch also on Smart TV)

· Is Netflix a threat or an opportunity to grow the Turkish online video market? It can be an opportunity by educating the Turkish people to conduct transactions online, to pay online for watching TV content on any device and in general to spread the use of devices used to watch TV content (tablets, smart-phones, game consoles, connected TVs). What do you think?

Frankly, Netflix was a quite sexy brand in Turkey before the kickoff of global expansion in January 2016. A lot of people in the industry was referring to Netflix as a extremely successful case study. Nevertheless, in the past 6 months since the launch of the service in Turkey, Netflix simply disappointed Turkish consumers. It’s basically because of the limited content portfolio as opposed to the content depth in US , lack of localisation (dubbing,subtitle) and quite high pricing level for Turkish consumers. It’s also worth to mention that piracy is significantly common in Turkey. But still Netflix is definitely an opportunity in Turkey since from content strategy point of view, from technology point of view, from content marketing point of view as well as user experience point of view there are a lot of things to learn from Netflix for the Pay-TV players in Turkey. Definitely, it will fuel the overall market development in many aspects over the coming months and years. Today, we are all witnessing that the number of localised Netflix content is constantly increasing. As the number of people using Netflix increases, this will also support the maturity of the end-to-end OTT value chain in general.

· Which is the OTT strategy for big broadcasting groups like Dogan, Dogus, Kalyon Group and Ciner? How is Dogus plan to further benefit from tvyo?

I do not have in depth information about this. But what I see in general is big broadcasters are mostly trying to leverage YouTube to make their VOD catch-up content widely available and monetising by ad revenue. Tvyo is kind of silent since some time with no major improvement on the service.

· What about the regulation of OTT services? Is in place relevant regulation in Turkey? If not, do you think that regulating these services will be beneficial for their growth or not? I am asking because in Turkey there have been attempts to regulate Facebook and Twitter recently.

Yes, I hear that RTUK is actively working on regulation of OTT market but i see it quite challenging to regulate the OTT space. The ultimate target is probably license OTT providers in some ways but considering low revenue low margin characteristic’s of OTT market, it think it will not help to market growth.

· Finally, how do you see the OTT Market developing in Turkey in the next 2,5 years, till the end of 2018? Do you see it growing fast, much faster than some developed European markets? Or with a much smaller pace, like the Middle East? And which factors will drive the growth and acceptance by the public of OTT services.

I think it will grow fast over the coming years. The rationale behind this is the upcoming tender about football broadcasting rights around the end of the year. Based on the statements of Turkcell one can expect Turkcell will become quite aggressive in the tender and leverage on its superior 4.5 Spectrum capacity in order to deliver football content to mass market. Also, the increasing broadband speed and coverage coupled with the expected increase on the fair usage cap will fuel the growth of OTT market.