Finland

June 2020

Key Takeaways

With its strong digital infrastructure, high penetration of mobile phones and minimal regulation, Finland is considered a tempting market for streaming services
Netflix is the most popular streaming service, although Finland is one of the countries where subscribers get the least value for their money
The limited catalogue is at least partly due to the small market and distinctive national language; also, local titles are only few

Market

Netflix entered the Finnish market in October 2012 – the same time the service was launched in Sweden. The opening campaign with the Swedish music streaming service offered Spotify Premium subscribers free Netflix subscription for the rest of 2012 also in Finland. Otherwise, a Netflix subscription would cost 7,99 euros per month.

Since launch, Netflix has considered Finland as a part of the Nordic market. While the countries have a lot in common in terms of history, culture and politics, Finland’s distinctive national language differentiates it from Sweden, Norway, Denmark and Iceland. It has also created a constant demand for domestic filmed and televised content and, therefore, contributed to a lively production sector in a country with only 5,5 million inhabitants.

Broadcasting in Finland is characterized by a hybrid model combining public service broadcasting and commercial television. In 2012, Finnish consumers were able to watch 13 nation-wide free-to-air television channels available in the digital terrestrial network. Four of these channels were provided by the public service broadcaster YLE and government funded, while 9 of them were commercial channels. There were also several internet distributed television services in operation. In 2020, the public service streaming platform YLE Areena provides catch-up TV services, live streaming as well as online-only content–all without commercials. Commercial broadcasters MTV and Nelonen offer ad-supported catch-up TV services with a limited number of programs as well as SVOD services. Nelonen launched its SVOD service Ruutu+ in 2006. At the moment, Ruutu+ provides ad-free episodes and complete seasons of series before they are aired on terrestrial TV channels as well as movies and sports. MTV’s SVOD service Katsomo launched in 2009. In 2017, MTV moved the chargeable content to a SVOD service called C More. Discovery provides both ad-supported VOD content and a SVOD service. All these VOD and SVOD services serve as complements to linear television.

Naturally, Netflix is not only competing with the broadcasters, as there are other streaming services on the Finnish market. HBO Nordic entered Finland simultaneously with Netflix and since then, Viaplay, Canal+ and Amazon Prime have also launched. Elisa Viihde, a SVOD service provided by a national telecommunications company, launched in 2009 with a movie-oriented catalogue. Since 2014, it has invested in original series and become the major provider of domestic drama.

Netflix launched within a highly competitive Finnish market but has steadily grown to be the most popular video streaming service in the country. Today, Netflix subscriptions range from basic (7,99 €/month) to double (11,99 €/month) to family (15,99 €/month). In comparison to competing SVOD services, such as HBO Nordic (10,95 €/month), Viaplay (9,99 €/month) and Elisa Viihde (11,90 €/month), Netflix is an affordable choice.

Regulation

Broadcasting in Finland is governed through an operating license system. Media and communication policies thus mainly concern linear television and set quotas for European and independent programming as well as regulate advertising and sponsored programming. Netflix and other SVOD services are regarded as internet content providers. So far, there is no specific regulation covering internet television.

However, EU directives provide common European regulation that is also applicable in Finland.

The latest review of the Audiovisual Media Services Directive in 2018 brought Netflix under EU regulation. The new rules strengthen the protection of minors against harmful content on VOD services and increase the obligation to promote European works for VOD services which now need to have at least 30 percent share of European content in their catalogues. Finland is in the process of reviewing the law on communication services. The review also includes the transposition of the new AVMS directive into national legislation, which should happen in the near future.

Viewing Habits

The use of mobile screens in moving-image consumption has been steadily growing since 2012, but at home television sets are still dominant. Recent research measuring Netflix viewing at home network (WLAN, wifi) reveals that in 2019, most (59 percent) at-home Netflix viewing was still done via a television set. 17 percent of viewing took place by computer, 11 percent by mobile phone and 13 percent by tablet. Viewing habits are similar for domestic internet distributed television services, which were also mainly consumed by television set (37 percent). Mobile phone had a 28 percent share, computer a 26 percent share and tablet a 9 percent share of the total consumption. Of the overall time spent watching broadcast TV and streaming services, linear TV channels had a 83 percent share. Netflix and YouTube both had a 7 percent share, but one has to note, that the research only measured viewing that took place in the home network. Mobile viewing is thus excluded. Broadcasters’ VOD services had a 4 percent here.

In 2012, Finns spent on average 3 hours 3 minutes per day watching television. Research by the audience measurement company Finnpanel shows that since then, television viewing time has slightly decreased to 2 hrs 42 minutes in 2019. Overall, the amount of television viewing has been quite steady during the last 5 years.

Internet Pricing and Availability

At the time of Netflix’s launch in Finland, Reed Hastings, the CEO of the company characterised the Nordic countries as a battlefield for future television. In his words, a newborn Finn is first given skis and an iPad. As a country with very high levels of mobile technology, Finland provides an interesting market for Netflix.

Finland has, in fact, been one of the leading countries in Europe in terms of mobile technology and internet use. In 2012, as many as 90 percent of Finns aged between 16-74 were using internet. 87 percent of households were connected to web and 45 percent of households had several connections (in most cases a broadband connection and mobile internet. At the moment, Finnish internet service providers are installing fibre optic wires and developing 5G mobile network. Newly built houses have fixed broadband and the cost is usually included in the rent or the maintenance charge. Therefore, the price of internet connection has not been an obstacle for subscribing Netflix in Finland.

Content

Netflix came to the Finnish market with a limited catalogue. For example, only four seasons of Dexter were available to Finnish fans while the US catalogue included seven seasons. The Netflix library in Finland still has not reached the level of other European countries. In 2019, research on where in the world the subscribers get the best value for money revealed that Finland is among the least cost-effective countries in the world along with Denmark, Norway, and a number of Middle Eastern countries. The research calculates the ratio of subscription price to the number of titles available. The monthly cost in each country is compared to others based on current exchange rates. According to the study, the total size of the Finnish library was 3,349 titles.

The number of local titles was, and still is, very limited. At first, the catalogue included 12 YLE programs which were also available on DVD. Despite this, YLE, MTV and Nelonen stated prior to the Netflix launch that they will not supply content to the streaming giant. The broadcasters have instead focused on developing VOD services of their own. At the time of writing, the library includes six Finnish series and one movie. One of those series, Karppi/Deadwind is available on Netflix worldwide.

Consumer and Press Reaction

Finnish press reported widely about the launch of Netflix, but the limited catalogue seemed to be a disappointment. Subscribers were expecting box-office films and HBO series.

With a distinctive national language Finland is a demanding market for international subscription services. In the beginning, Netflix tried to overcome the challenge of providing subtitles by using the translations by DivX Finland, a community of voluntary translators. Netflix later apologized for the unauthorized use of amateur translations and announced it will sort things out with its content suppliers. The incident caused a negative tone to the publicity surrounding the launch with headlines stating that “Netflix screwed up” and “Netflix translations under criticism”.

Despite the bumpy start, Netflix has become the most popular streaming service in Finland. This is probably both due to the moderate price and the global hype around the streaming service. A number of movies and series have grown into social media phenomena and topics of water cooler discussions even among those who do not subscribe Netflix. YLE, for example, has repeatedly reported about the popularity of Stranger Things and Netflix’s leading role on the streaming market. Any Finland-related issues about Netflix usually make headlines, like the one on Finnish developer making a game on Stranger Things. The distribution of Finnish series (Karppi/Deadwind and Sorjonen/Bordertown) on Netflix has been of great importance to the Finnish television industry and Finland as a country.

Subscriber Estimates

As elsewhere in the world, Netflix has not published its subscriber numbers in Finland. There are, however, a few estimates available. In 2014, the number of paying subscribers was 370,000 according to Digital TV Research. Next year, the number was 540 000 while Sweden had 1,1 million subscribers at that time.

A recent estimate by FlixPatrol suggests that 15 percent of the population in Finland are subscribing to Netflix which makes about 800 000 people. This was still the lowest number among the Scandinavian countries. A 2019 estimate by Statistics Finland suggests 45 percent of Finns were using SVOD services (Netflix, HBO Nordic or Viaplay). Despite the low numbers, with a steadily growing subscriber base Netflix is the most popular subscription service in Finland.

Local Netflix Office

Netflix does not have a local office in Finland. The country is considered part of the Nordic market.