Pay-TV operators making concerted bid for "underdeveloped" Finnish market
Canal+ buys foothold in digital TV world with domestic ice hockey league
Pay-TV channels are seeking a foothold in the Finnish television market.
Right now the most vigorous efforts are to be seen from Canal+, which began transmissions of Finnish Elite League ice-hockey matches yesterday, Thursday, as the new season got under way. Previously league games have been seen on the free-to-air commercial channel MTV3.
Canal+ is looking to make itself a sound platform for the moment when Finland "goes digital" in August 2007, and analog broadcasts are scheduled to be wound up.
The operator sees Finland as a wonderful opportunity, and hopes to triple the number of subscribers in the next two years.
For Canal+, securing the popular domestic ice hockey sector is a great victory, since it brings attractive Finnish programming to an otherwise predominantly "international" channel.
The operator is sharing the rights to the Finnish League matches with the commercial channel Nelonen, owned by the SanomaWSOY Group, in such a way that Canal+ will feature matches in the normal season, and play-off games will be shared with Nelonen. The actual play-off finals will go out on Nelonen only.
Traditionally, sport has been the big drawing-card of pay-TV services, as shown by BSkyB's capture of a sizeable share of the UK market after securing the rights to live coverage of Premiership football matches.
Canal+ already shows English Premiership and Italian Serie A football, together with movies and drama series. Canal+ can be seen via cable, satellite, or through the terrestrial digital network, while its main rival Viasat's TV1000 is watchable only via satellite or cable.
Hitherto the pay-TV market in Finland has been relatively small. Finland is seen as the most underdeveloped television territory in Europe in this respect. Whereas elsewhere there are often 20-30% of households buying in subscription services or pay-per-view, in Finland the current figure is only around 5%.
Canal+ and others believe that pay-TV will come of age in Finland as television goes digital. The digital receiver will become a kind of mailbox, into which drop both subscription newspapers and free papers.
The belief is that as consumers' expectations grow, they will be prepared to pay for the content that they want. Equally, the scenario in the future is that the traditional barriers between the free-to-air and pay-TV worlds will come down: commercial channels funded by advertising revenue will also screen pay-per-view programming, while the subscription channels will take commercials.
Finland's only modest inroads into the pay-TV market derive from the fact that the country has "a relatively strong free-to-air service", according to pay-TV pioneer Jarkko Nordlund . Nordlund was previously the head of Finnish operations at Canal+, but has recently left the company and will be joining Viasat in a similar role next year. He is currently completing a dissertation on pay-TV.
One other reason for the relative lack of interest in pay-TV hereabouts is the small market of just 2.3 million households, which has not tempted in the big operators.
The commercial free-to-air station MTV3 has responded to the pay-TV challenge by showing pay-per-view ice hockey and Formula One packages on its MTV3+ channel.
It has also built up a pay-TV channel on its Subtv subsidiary, with a view to allowing cable transmissions of Subtv's reality show Big Brother around the clock. More ideas are in the pipeline, according to Jorma Härkönen of MTV3 Interactive.
Nelonen, meanwhile, believes that digital television will stimulate viewing of smaller niche channels, some of which will be pay-per-view. Nelonen has launched an online ordering service, in which subscribers can download programming against payment, including additional material not seen on the free-to-air network.
The national public broadcaster YLE (The Finnish Broadcasting Company) does not have plans to build pay services, but intends to reply to the challenges through quality programming free-to-air, relying on the fact that the free channels have thus far proved sufficient to meet consumer demands.