Sky Gives Up In Spain

Comcast’s European Sky operation is closing down its OTT streaming service in Spain in late summer 2020, after failing to gain more than 100,000 subscribers in almost three years.

The service launched in September 2017 offering a mix of 12 live channels along with TV series, movies and documentaries on demand for €10 a month. Later, more channels were added and the price cut to €6.99 a month in a desperate attempt to gain momentum, but the service was still crowded out by a combination of the big global players, especially Netflix, Amazon Prime Video and HBO Espana, along with local providers such as Rakuten TV. The eventual entry of Disney+ and Apple TV+ among others then helped persuade Sky to cut its losses and pull out.

This contrasts with Sky’s success in its established European markets, that is the UK, Ireland, Austria, Germany and Italy. In all those cases strong market share was gained through satellite TV reinforced by exclusive rights to premium sports, making subscriptions very attractive to relevant fans. On the back of that. Sky was able to take a healthy stake in the burgeoning OTT markets, starting with TV Everywhere offerings to existing DTH subscribers and then standalone as well. The Spanish experience shows how difficult it is for a foreign operator to come in and compete in OTT alone both with indigenous and major global players on a diet of TV shows and movies with relatively few hot tickets.

Spain itself is an expanding and dynamic OTT market with 6 million total subscribers now, so Sky was correct to identity the potential opportunity. But that market has come to be dominated by the three big US owned SVoD players, and Netflix in particular, rather like the Spanish speaking Latin American countries. Between them Netflix, Amazon Prime Video and HBO Espana hold 91% of the Spanish OTT market by number of subscriptions, according to S & P Market Intelligence. Netflix accounts for 63%, Amazon 16% and HBO 12%, with the rest shared between Rakuten TV, Telefónica SA's Movistar+ Lite, DAZN and Mediaset Espana Comunicación SA's Mitele Plus, plus a few other small local players.

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