Berlin It should be nothing less than “the German media subscription”, says RTL co-boss Stephan Schäfer. His colleague Matthias Dang raves: “There is no such thing as a product. We build the blueprint. ”
In fact, RTL is creating something so far unique for the media industry: a streaming platform on which there should not only be live TV and films. From summer 2022, users will also be able to access podcasts, audio books and music titles as well as digital books and magazines on the “RTL +” platform, which operated under the name “TV Now” until Thursday.
All media bundled in one app – RTL presented the concept to producers and actors on Thursday to selected media, including the Handelsblatt. The RTL parent company Bertelsmann is serious: Compared to 2021, the annual program investments are to be tripled to around 600 million euros by 2026, announced Thomas Rabe, who is also head of Bertelsmann and the RTL Group.
RTL is fighting against the powerful tech companies Facebook, Google and Amazon, which control 80 to 90 percent of the digital advertising market. At the same time, international platforms such as Netflix or Disney + are digging the broadcaster’s viewers. In order for local providers to survive, they have to look for ways to differentiate themselves from the competition – as RTL is now trying to do.
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“RTL +” symbolizes Bertelsmann’s strategy of bringing together media of different genres. The Gütersloh-based company want to merge the Hamburg magazine subsidiary Gruner + Jahr (G + J) with the Cologne TV group RTL on January 1, 2022.
Even the competition sees opportunities
Because there is no role model for “RTL +”, the project is an ambitious experiment. But even the competition seems to have done it: Netflix boss Reed Hastings said in an interview with Handelsblatt in September: “RTL will be very successful with what they are planning to do there.”
Experts also see potential. Olaf Riedel, Partner at EY and Head of Technology, Media & Entertainment and Telecommunications, says: “The chances of reaching a wider audience with a uniform platform are great.”
On “RTL +”, the media company can use TV programs or newspaper articles in addition to the broadcast or the printed magazine and thus “reach additional user groups at comparatively low costs,” says Riedel.
Studies show that there is a growing need for platforms that offer users access to different offers in one app. Bertelsmann and its brands in particular have the opportunity to do this like hardly anyone else: The new platform will include magazines such as “Stern”, “Geo” or “Brigitte”, which belong to the subsidiary G + J; Audiobooks and books from Bertelsmann Verlag Penguin Random House as well as music and podcasts from Audio Now.
In the music sector, RTL has entered into a partnership with Spotify competitor Deezer. RTL also plans to cooperate with other media companies.
Big distance to Netflix
RTL currently has 2.4 million paying subscribers on its platform, a year ago it was 1.8 million. Despite the growth, the gap to Netflix is large: Although Netflix does not provide any figures for the German market, the London-based analysis company Ampere Analysis is assuming 10.9 million subscribers for 2020.
RTL wants to reach the ten million mark by the end of 2026, but together with the Videoland service in the Netherlands, which currently has around one million users.
Big goals that industry experts believe are achievable. Bernd Riefler, founder and CEO of the analysis company Veed Analytics, says: “In the television and streaming market there is not just one provider who taps into all customers. There will always be room for the variety of offers. ”
Netflix mainly offers films and series; RTL also sends news, sports broadcasts and in future will also be making e-books and radio plays available – areas that are not worthwhile for the US competition. Netflix boss Hastings also believes that RTL will play out its local advantages. “We will certainly not become more German than RTL.”
The Cologne-based company is still working out how expensive the streaming service will be. At the entry-level price, users receive advertising; the premium version should be free of it. The RTL creators are convinced that users are willing to spend money on what they offer, even if they already have subscriptions to the competition. According to internal analyzes, consumers would take out two to three subscriptions for streaming services on average.
EY expert Riedel confirms the trend: “The willingness to spend money on good content has increased due to the pandemic.” This applies especially to older users, younger people are longer willing to pay for advertising-free offers because they get it from streaming services familiar with.
Marketing opportunities
There is another reason for the repositioning: With the predominance of Google, Facebook and Amazon, local companies like RTL have to make their advantages for advertising companies clearer than ever. “With different categories in one app, media companies can increase the attractiveness of their marketing opportunities,” says marketing expert Andreas Schwabe, partner at the Boston Consulting Group (BCG).
“RTL +” should have a personal area in which Artificial Intelligence suggests other similar films to users, but also suitable podcasts or newspaper articles. Due to the wide range of different categories, the algorithm learns more quickly which content customers like. “This is a smart step for both the end customer and the marketing,” says Schwabe. Advertisers could display more targeted campaigns to users.
In order to reach more users, RTL is working with Deutsche Telekom. On the Magenta TV platform, users should get “RTL +” at a lower price. Michael Schuld, TV boss at Telekom, says: “There is a need for new simplicity.” Whether “RTL +” can meet this, however, will not be seen until next summer.
More: RTL wants to grow faster with Gruner + Jahr