Six months after the launch of Netflix in the Netherlands, RTL Nederland — a subsidiary of RTL Group that operates seven channels in the Dutch market — is undergoing a digital transformation with the rollout of two VOD platforms, Videoland Unlimited and NLziet.
“RTL had anticipated the launch of Netflix,” says RTL Nederland CEO Bert Habets. Indeed, in August, RTL Nederland acquired a 65% stake in the Entertainment Group, which owns Videoland, the biggest local VOD platform. And at the beginning of this year, the group teamed with Netherlands pubcaster NPO and SBS Group to create a subscription-based service, NLziet.
Videoland is a pay-VOD platform, Videoland Unlimited is an all-you-can-watch service featuring Dutch originals and international series and movies, while NLziet is a subscription-based VOD platform featuring catch-up services of RTL Nederland, SBS and NPO.
So far, it’s too early to assess the success of the shingle’s digital strategy: Videoland’s transaction and subscription services have launched but are only available via set-top boxes. NLZiet is still in beta and will likely bow later this year, along with the highly anticipated OTT standalone version of Videoland.
“Wider device support is not yet available (on Videoland) — this is one of the key factors behind Netflix’s success, so Videoland will need equivalent device integration to compete,” says Richard Broughton, Screen Digest senior analyst.
RTL Nederland has used Videoland as a promotional launchpad for “Divorce,” a drama series now in its soph season. The show premiered on the digital platform before bowing on RTL 4 and attracted a healthy 2.2 million viewers. “We noted that VOD and linear programming can complement each other, and we’re discovering new ways of reaching consumers,” says Kim Koppenol, RTL Nederland’s manager of corporate communication and brand strategy.
Habets says he’s not concerned with Netflix taking audience share away from RTL Nederland’s core channels.
“The VOD market is young,” the topper says. “There are no specific audience shares available yet. The overall viewing time, however, in the linear domain is still growing every year.”
Indeed, the company’s strategy remains focused on advertising-funded video relating to its broadcast channels. Meanwhile, digital revenues continue to build, rising 26% to €236 million ($324 million) due to both organic growth and acquisitions in 2013.
“The VOD market is only just starting to develop, and we will see a quick increase of suppliers in the coming years,” Habets says. “We think the quality and richness of the content, and powerful marketing will be decisive in who will win over the consumer in the long term.”
RTL Nederland can’t compete with Netflix on the rate. Netflix is priced at €7.99 per month, while Videoland Unlimited cost €10 monthly. But Videoland’s competitive edge lies in its broad offering of Dutch content since RTL Nederland has rights to local films and series in which it invests.
Netflix has made a strong start in the Netherlands, but will face a serious competitor once RTL expands Videoland onto a larger array of connected devices by the end of 2014.
As Habets puts it: “One thing is certain, these are interesting times for our industry.”