According to a recent analysis by Digital TV Research, Netflix and Amazon Prime Video are expected to exit the Russian market due to new regulations for over-the-top (OTT) platforms. These rules require foreign streaming services with more than 100,000 subscribers in Russia to limit their content to no more than 20%, similar to restrictions on traditional linear TV networks. This move is likely to push both companies to reconsider their presence in the country.
The report predicts that by 2022, Netflix and Amazon will significantly boost the growth of subscription video-on-demand (SVOD) services across Eastern Europe—excluding Russia. Netflix is projected to reach 3.43 million subscribers by 2022, nearly three times its 2016 numbers, while Amazon is expected to have 1.12 million. However, these figures do not include Russian users, who are now excluded due to the new laws.
Simon Murray, chief analyst at Digital TV Research, stated, “We believe this regulation will force Netflix and Amazon to abandon their independent platforms in Russia. It’s a major setback for their global expansion plans.†He added that the two companies may shift their original content to local Russian platforms. For instance, Amediateka has already launched the ‘HBO Home’ brand, and other platforms might follow suit. Netflix has also partnered with China’s iQIYI, suggesting a possible trend of localization.
The loss of the Russian market could be a significant financial blow. With strict media regulations preventing them from operating independently, both companies may need to adapt their strategies. By 2022, after excluding the 6.8 million SVOD subscribers in Russia, Netflix is expected to hold 35% of the market in Eastern Europe’s 21 countries, while Amazon would account for 12%.
By the end of this year, SVOD is set to become the largest OTT service in the region, with revenue reaching $1.3 billion by 2022. In contrast, in 2016, it was only $190 million, making up 34% of total OTT revenue. Digital TV Research forecasts that OTT TV and movie revenue in Eastern Europe will hit $2.23 billion by 2022—four times the 2016 level. Russia is expected to capture 46% of the market, followed by Poland at 19%.
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