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STREAMING EUROPE · The Media Odyssey

• Marion Ranchet: [00:00:00] In a way, right, in the UK, when you pay the license fee, you're paying the BBC to access the BBC. Evan Shapiro: Yeah. It's funny, I made the mistake of saying the BBC was free the other day and there was a Brit in the audience. It's like it's not free. Marion Ranchet: Yeah, exactly. Evan Shapiro: We pay for it, like, alright, fine. Welcome back to the Media Odyssey podcast. That is Marion Ranchet. Marion Ranchet: And this is Evan Shapiro. Evan Shapiro: And today we're gonna talk about, oh, first of all, where are we? Marion Ranchet: We're in Lyon, in France. Evan Shapiro: Lyon, France? Marion Ranchet: Yeah. Evan Shapiro: Lyon, France. Marion Ranchet: Yeah. Evan Shapiro: We're in France? Marion Ranchet: We're in France. Evan Shapiro: How did we get here? Marion Ranchet: Ooh, good question. Actually, this is partly due to our amazing guests. So we're coming to see the team from Bedrock Streaming. You'll know everything about these guys. We're gonna have Jonas Engel coming to chat with us. Evan Shapiro: Cool. And so Bedrock Streaming does streaming infrastructure [00:01:00] for a bunch of big players here in Europe. And I was asked recently, 'cause I spend a lot of time in Europe, which I call my favorite continent now. Marion Ranchet: Yeah, it's mine too. Evan Shapiro: Yeah. It is a great continent. It's full of history. It's a lovely place. But also America is on fire. So I like coming here for many different reasons. We were just in London, now we're in France. But I was asked recently to describe the difference between the television ecosystem in the United States and the television ecosystem in Europe. To describe the differences in consumption habits and platforms and things like that. And I started to get into it, and then I realized I have this great resource. The whole reason we started this podcast is so that I could tap into you. So you offered to teach me the history and kind of state of European streaming. Marion Ranchet: Yeah, of course. Evan Shapiro: You ready to do that? Marion Ranchet: Of course. Yeah. Well, I'm schooling you every week, but I'll, I'm gonna take it one step further this week again, to talk about my favorite continent. Everyone knows that I'm French or not. Evan Shapiro: You're French? Marion Ranchet: Yes, I am. Evan Shapiro: Wow. Marion Ranchet: I know. I have a good accent, right? Evan Shapiro: You can barely stop. Marion Ranchet: Yeah. It's not gonna be an episode in [00:02:00] French, but Evan Shapiro: Good. Because I don't speak Marion Ranchet: Yeah. Good, good. Because I've heard you make an order. It's quite pathetic. But no, super exciting because I think that overall in the region, we're just too modest, too humble, right? And there's a lot of cool things happening. There's a lot of changes. But we have this tendency of, downplaying everything. And so what I wanna do today is take you through a couple of key trends that I see in the region. And then, I'm also keen to hear, but maybe we can start with that just quickly. What did you tell people when you had to say one thing about the European market? What was the one thing that you know came up fairly quickly? Evan Shapiro: It is the public broadcastings. Marion Ranchet: Interesting. Evan Shapiro: The public broadcasters they, the fact that they exist in Europe. And they really do not. In the US we have PBS, we have NPR, but we don't really invest. In fact, per capita, the United States invests one 10th in public media compared to Europe. Per capita. And that really influenced streaming. Because, as [00:03:00] we were discussing, you don't see a locally grown independent streamer here. All the good streaming comes from public service broadcasters. Marion Ranchet: Yeah. So I think what's that's one of the interesting thing. I think we would've loved to be the continent to give birth to a Netflix. But we haven't. But again the good thing is that we have a lot of local players who've been in the market for decades. Evan Shapiro: A long time. Yeah. Marion Ranchet: For decades. TF1, in France, they turned 50 at the beginning at the beginning of the year or last year, I can't remember. And so most of the streaming services today, somehow in the background, have a broadcaster. And I love that narrative because I'm hearing a lot of people saying, linear TV is dead. Broadcasting is doomed. They kicked it. And I write a lot about that topic and I wanna focus today on what these guys are doing. I'm gonna give a couple of example and the thing that I wanna do first is do a bit of geography. This is, Evan Shapiro: I'm terrible at geography. Marion Ranchet: Yeah, I'm sure you are. So this is not Lyon, Paris, Texas. This is France. [00:04:00] So this is the French markets. We have Italy, Spain, and Germany. With the UK, this is what we call EU five, right? So this is Western Europe. I wanna focus on that because again, this is a big continent. A lot is going on in that market, and you are seeing different trends in an Nordics, different trends in Eastern Europe. So I don't wanna pretend that we're gonna cover it all. We don't have time. But if I look at EU five markets and I'm gonna, Evan Shapiro: Those are also the five largest television markets. Marion Ranchet: Yeah. Absolutely. Those are the biggest market in the region. And I'm gonna leave the UK because we've covered it, at length and it looks Evan Shapiro: That's true. So we have covered a lot about what's happening in the UK. We have a past episode with Channel 4. I've done a lot you, with you about our BARB report. Marion Ranchet: Yeah, absolutely. Evan Shapiro: Which is why I wanted to explore the other regions a little bit more. Marion Ranchet: And I think the UK looks, in many ways there's changes there that, everyone says it happens in the UK after the US and then it comes to continental Europe. So we're in continental. Evan Shapiro: Is that true? Do you feel like a trend hits in the US then it comes to the UK and then it spreads to the rest of the EU five and the rest of Europe. Marion Ranchet: Yes. It will [00:05:00] depend. And even within the EU five market you are seeing also micro trends, but as a whole, what I would say is that yes, we haven't been able to build a streaming native or streaming first champion. But what we're seeing in each of those markets are broadcasters who have seen linear viewership, decreasing and thinking, alright, how are we making sure that we're still targeting and reaching those audiences that maybe are spending less time watching television, which is still a big amount. When we look at those markets versus the UK and the US. A market like France for example, you are looking at over three hours per day, right? For people on TV. Yeah. Aged four plus. So we're still watching a lot of TV, but what TV means is changing, meaning that it's not just a live linear broadcast. All of those companies have built on demand vehicles. They started small in the sense that it was very much not a copy and paste, but almost a [00:06:00] copy and paste of what was happening on linear, right? So whatever you had on linear, you then had. Within an on-demand hub, and that's how BBCI player launched. That's how M6 Replay and My TF1, all of these guys had, Evan Shapiro: So these are basically broadcast duplicates? Marion Ranchet: Yeah, exactly. Except that you had that digital component Evan Shapiro: And on-demand and environment. Marion Ranchet: You could choose. All of this is free depending on which service. You are being served ads, right? So we make a distinction between the public broadcasters, right? Who are mostly funded either via taxes or a license fee. Some can actually put some ads, but someone like the BBC cannot, they're only funded by the license fee that UK consumers are paying every year. And then you have the commercial guys, and these guys are essentially ad sales powerhouses, and this is an important point that we'll touch upon later because they have a massive edge. They've been in that business for, again, the last the last 50 years. And so what we've seen changing is that these guys are now really building hubs that are almost [00:07:00] standalone hubs. Some, in the sense that whether that's TF1, M6 Plus, you can decide not to watch any live TV. If you want, you can, but if you just wanna consume on demand content, you can. The libraries are not just about what was on broadcast. Someone like TF1 has I think something like 30k on demand assets, M6 50k. Evan Shapiro: They're licensing content and housing content isn't necessarily on their broker. Marion Ranchet: Exactly. They're really building massive hubs. It's almost like a Netflix like approach. The only difference that it's free. Evan Shapiro: But homegrown. It's free. Marion Ranchet: Yeah, it's free. Evan Shapiro: But even the commercial players are traditionally offering their streaming service for free, or is it, is there a paid? Marion Ranchet: So it's interesting, they do both, but historically they're very much free to play players. Evan Shapiro: Because that's how they are over the air. They're broadcast. Marion Ranchet: Yeah, exactly. Evan Shapiro: They're commercial only. There's not an affiliate fee. Marion Ranchet: You are not paying to watch the broadcasters. Evan Shapiro: Yeah. Just to take a beat on that for a second. There is a, that's another major [00:08:00] difference. Yeah. So broadcasters used to be free in the United States. Yeah. I remember when broadcasters were free, but now, for the most part, while you can access them with an antenna if you really want to, very few people do. And most people actually are paying to get the broadcasters into their home over cable. Over pay tv. Pay tv and satellite, and cable. Cable, what we call it in the US, really doesn't command that much of the marketplace here in Europe. Anymore or? Marion Ranchet: What's interesting, no, I thought you were mentioning the US but Evan Shapiro: No, it's declining. Obviously. Marion Ranchet: There's multiple way to access free television. So that's terrestrial, that's the antenna. It's true that you can use the setup box of your operator where, it's this one big bundle where you have mobile, internet and TV. So in a way, it may feel like you're paying. But I would still think that most people think that this is, baked in and they're not really paying in a way. In the uk when you pay the license fee, you are paying the BBC to access the BBC. Evan Shapiro: Yeah. It's funny, I made the mistake of saying the BBC was free the other day and there was a Brit in the audience. It's [00:09:00] not free! Marion Ranchet: Exactly. Evan Shapiro: We pay for it. Like, alright, fine. Marion Ranchet: But there's not that paywall getting in the way. Evan Shapiro: But the point you were making crucially here is that the broadcaster, so the M6s, the TF1 Marion Ranchet: RTL. Evan Shapiro: They are, for the most part, making their streaming offerings free, the way that their broadcasting was intended to be. Marion Ranchet: Most of them have a premium component where you can go at free. But honestly, I've never seen any numbers except for the UK with ITVX. Which is around, yeah, it's around a million when they have over 14 million monthly active users. So you see Evan Shapiro: Less than 10%. Marion Ranchet: The DNA is not in fully premium for most. We have one exception, well there's a few exceptions, but one major exception and we'll talk to it later on because Bedrock is part of the same the same group. It's RTL Plus in Germany, so it's a commercial broadcaster. They had TV channels. They started Evan Shapiro: free. Marion Ranchet: Yeah, again, free. Ads being served. They started with an on demand play and then these [00:10:00] last few years they've built this massive vehicle and they have something around seven to 8 million subscribers on the German market. And it's a mix of free and pay, and they've been very successful at that. Evan Shapiro: Is there a free, there's a totally free version. Marion Ranchet: Yeah. Evan Shapiro: Which has the full ad load. Maybe not all the content. Marion Ranchet: Yeah. Absolutely. And then they have two tiers, Evan Shapiro: The pay has more content. Marion Ranchet: We'll ask Jonas exactly 'cause I can't remember. Yeah. But but again, it's not a pure player like we've seen, with a Netflix like you guys in the us. And I think that shows our ability to innovate and to follow the trends, right? Where users are making moving away from linear into digital and streaming. And again, we're not saying enough about those players and what they're bringing to the table. And we'll speak later about, the platform excellence that they thrive to bring to local, I think local consumers. Evan Shapiro: I think that's the, that is, so there's two things. You're right. I think Europeans tend to be a little bit, even the French. polite or apologetic Marion Ranchet: Yeah. Evan Shapiro: About [00:11:00] what they do in our business. Marion Ranchet: Yeah. Evan Shapiro: Meaning we're just Europeans, we're not, the American or the global players. Marion Ranchet: Yeah. And at the same time, we're pissed off when you guys are just showing muscles. So I think we gotta change the narrative a bit, Evan Shapiro: but I think, there's two things to note here. When you look at every territory in Europe and you look at only streaming, not broadcast, the top three to four slots are global, American streaming entities. Marion Ranchet: That's true. Yeah. Evan Shapiro: Typically in order, YouTube, Netflix, Prime, Disney. Marion Ranchet: Yeah. Evan Shapiro: And this is true, like when you look at England, even, BBC was, the reason why I think they're so successful as a streamer is they got into it very early. Marion Ranchet: That's true. Evan Shapiro: There were, there was Netflix and then really in quick succession there was SBT in Sweden and BBC, and they came, they fast followed and they got out ahead of it. So I think that's why they are so good at streaming. And you're right, I think the rest of Europe fly, followed in behind [00:12:00] that or floated in behind that. On the flip side, when you look at streaming habits, and especially true when you look at streaming streamers under the age of 30 or 35, it's dominated by the American players and you've never seen a European streamer really, ViaPlay, tried it, they failed. Marion Ranchet: Yeah. And these guys are coming from ViaSat, again, broadcaster. Evan Shapiro: In the US, no one's really been able to reverse the trend there. I think one of the key elements is it's very difficult to hyper serve. We were talking about this earlier. Reed Hastings said, we're not local. We're global. If you want local content, go to your local programmers. We're a compliment to that. Marion Ranchet: Yeah. Evan Shapiro: The flip side of that is none of these folks are truly global. Marion Ranchet: Yeah, that's true. Evan Shapiro: Or inter-regional. Yeah. Streamers. There's a couple different reasons. One rights and content and language. But beyond that is the infrastructure. It's very hard to, Netflix, because they have to stream for a hundred million, 200 million players because they have to think about a global reach and a [00:13:00] global footprint, they have to, or they were forced to build an infrastructure that could handle that much. Streaming that much bandwidth, that much technology flowing all over the planet Earth. Whereas if you're BBC, it's a free player for England. That's it. That's a different use case. Marion Ranchet: It's also a question of timing Evan Shapiro: than building a multinational. Marion Ranchet: It's a question of timing. Like I think it's hard to compare people who've been in the TV business for 50 years. And folks who launched 20 years ago, I'm sorry, but the world has, all of those companies. Evan Shapiro: How, wait. I'm thinking what you're saying there is, there's a difference between, let's say ZDF or RTL and Netflix. Marion Ranchet: Before internet and after internet, right? No, but the rules of the games are different, right? When they, all of these guys, the broadcasters came in, they did with the technology that was available at the time. And the technology was again very much localized. It's not like you were pressing a button like Netflix did 15 years ago and said, boom, we're live globally, right? So they've been, [00:14:00] local champions. It's local champions, trying to ride that wave and adapt. So not trying to say that Netflix had it easy, but I think it's very hard to compare the two. You are talking about a company that is still fairly young. Evan Shapiro: Netflix? Marion Ranchet: Yeah. Even if it's 20 years old. But the same for YouTube. Evan Shapiro: But they're so dominant. I think it's very easy for us to think that they always existed, but in reality, Marion Ranchet: They did not. And I'm sorry, Evan Shapiro: Less than 20 years ago, they were delivering DVDs Marion Ranchet: Exactly. Evan Shapiro: Through the mail. Marion Ranchet: Yeah, that's true. It's a great example of a company who's a transition, perfectly. But what I'm saying is that they haven't been around the block for so long, and so they, they don't have that thing about having a an historical or legacy. Legacy maybe is not the right term because it looks this like a debt weight. But it's an asset for all of these guys. But at the same time, what's tricky is that they're trying to navigate the two things. They're trying to build to keep the linear vehicle, which I'm sorry, is still the biggest portion of both viewership and money coming their way. You look at ITV, they released [00:15:00] their results a few weeks back and digital ad revenues, it's only 26% we're talking, still talking about Evan Shapiro: Right. But hit pause there for a second. It's 26%. That's actually pretty, Marion Ranchet: Yeah, that's pretty good. Evan Shapiro: For something pretty sizable. Marion Ranchet: Yeah, for something that launched two years ago, right? Yeah. A hundred percent. But but so they are dabbling in those waters, so I'm not saying that it's easy to be Netflix. But yeah. Evan Shapiro: It is easier though. There is this thing, which is, first of all, Netflix doesn't have a linear product. Marion Ranchet: No. Evan Shapiro: Every broadcaster streaming app has a linear product and an on-demand product. Every single one. Marion Ranchet: Yeah. Evan Shapiro: And so that is, Marion Ranchet: I think that's an asset. Evan Shapiro: That's a, it's not only an, I think it is an asset. I think you're right. Marion Ranchet: Unlike what Read is saying when it's saying that he was speaking about the US companies, but during the, it was Ted, it wasn't Read, but he said unlike others, we don't have Evan Shapiro: a linear network. Marion Ranchet: Dead weight linear asset. Evan Shapiro: Distraction. He said distraction. He didn't say dead weight. Yeah. I think that's how, but then Bob Iger basically told him, fuck you. A couple weeks later, he is this [00:16:00] is spin off a billion dollars a year in cash rush. Shut the fuck up. Which I thought was a neat clap back. But I do think that there, it is harder to do what the streamers in Europe are doing. They're forced to do the more difficult thing of combining linear and on demand. Marion Ranchet: I'm happy you are agreeing. Evan Shapiro: I, oh, I totally agree. And I also think that, let me ask you a question. I think that the history of free television here is an advantage this ecosystem has that the US, the fact that we pay for everything in the US Marion Ranchet: Yeah. And pay a lot. Evan Shapiro: Which is now beginning to catch up to us in the churn-pocalypse. No one ever churns from the BBCI player. No one ever turns from probably, RTL Plus free. Nobody ever churn from ITVX free because why would you cancel? Marion Ranchet: True. But so it's not churn and because it's not a subscription, but there's still that loyalty element, even if it's free. Evan Shapiro: That's true. So you can churn. You cannot go back. So that is a big advantage, but I also think it makes it much more difficult Yeah. To [00:17:00] be a streamer in Europe because you're so focused on this duality of linear and on demand of the ecosystem that you're already trying to protect. So I think it's a higher bar. And my question to you is, you look at the history of free here and you would think that there would be less intention to pay, right? Which explains the popularity of YouTube on streaming for Europeans. But it doesn't explain Prime Disney and Netflix. Why do you think all of a sudden the Europeans have started to lean into the idea of paying for content when so long they didn't? Marion Ranchet: So, that's a very good question. Evan Shapiro: Thanks. Marion Ranchet: I think there's a few things and there I have to say, I have to give credit to Netflix. I think they've really created a market for themselves and then for others. A hundred percent. And I think it was a lot around not so much being, it wasn't so much about, oh, there's no ads, because we do have ads, but it's nothing compared to you [00:18:00] guys where you are getting an ad every 10 minutes. The ad-load is much lower here. Evan Shapiro: That's true. Marion Ranchet: So I think it was more convenience. Being to watch content, on the go, whenever you want, et cetera. So I think that's really Evan Shapiro: On any device.. Marion Ranchet: Yeah. Exactly. Evan Shapiro: Do you think it's also, I make a big deal about the generational shift in this territory on my favorite continent Europe. Which is, you guys are, you're the upside down from the rest of the world. You're Marion Ranchet: Agewise? Evan Shapiro: Agewise, yeah. You're almost 60% over 40, whereas the US is 52 or 3% over under 40. The world is almost two thirds under 40. Do you feel like millennials becoming the heads of household, like I, I love to say millennials aren't kids. They have kids. Marion Ranchet: Yeah. Evan Shapiro: Do you feel that generational shift, as slow as it's been to come here, is now really taking hold? And when you look at the streaming audience, it tends to be younger than the older audience? Marion Ranchet: Yeah. So we were talking about linear tv, and just for a second, I think, one of the reasons why, [00:19:00] you know, on top of the quality of content having local content, the fact that it's free a big portion of why linear is resisting so well is, and what we're seeing in any numbers in any of those EU five markets is of course TV is very much, what I would say senior, but over 40. Oh man, I'm 45 this year. Evan Shapiro: Actually over 55 when you look at the Marion Ranchet: Yeah, 55 and older. So the question is will these new generation take within their habit and then there's no room for TV? Is that where you're saying? They're only focused on subscription? Evan Shapiro: If you look at, in every territory, so it's not just the UK where I've done most of my research, but I've looked at each one of these territories. And the broadcaster's streaming platform comes in fourth place on or third place on a good day place. Marion Ranchet: There's irrelevance challenge. Yeah. Evan Shapiro: But when you look at consumers under the age of 40 in these territories, the broadcaster streamer comes in fourth, fifth, sixth place [00:20:00] behind. You're talking about Netflix, YouTube, Amazon, Disney, and now even, with Max coming over here and Paramount, really spreading their wings over here, suddenly they're gonna be competing more and more for time and attention. Yeah I think it's really unlikely that somebody who's 20 years old and is streaming a healthy diet every day of YouTube and Netflix is gonna suddenly wake up someday and you say, you know what? I'm gonna download the broadcaster app, but maybe I'm wrong. Marion Ranchet: I think maybe it's a long shot for them to turn off, turn on their TV and watch linear broadcast. But I think the whole point of those streaming hubs from broadcasters is to make sure that actually they're always in, Evan Shapiro: That they're getting out ahead and sports rights is a big part I think in Europe of keeping that audience around, if you can keep the major football leagues and other sports and the Olympics. Marion Ranchet: And there's a question of local stories as well, right? You wanna this when you wanna watch, true local stories and, sorry, [00:21:00] Emily in Paris does not cut it. That's not French content. Evan Shapiro: That's not French. Marion Ranchet: That's not French. No. Even Emily, I wouldn't, it should be written with a Y, but no, but honestly, if you look at big cultural moment, whether that's through the news, through sports events, and through drama, comedy, et cetera, I think these guys have a big role to play. And what's interesting is that we've been seeing, these last few months, is there's a lot of collaboration between the streamers and the broadcasters. The big streamers were like, we're doing everything on our own. There's many more co pros. There's many more Evan Shapiro: Yeah. Now especially, yeah. Marion Ranchet: Windowing where, you know so TF1 and M6 will be doing a daily soap. It's gonna be on Netflix five days later, it's on TF1. So there's gonna be a more of that coming. And one of the reasons is because those local players have those local stories. So, I think there's still a way to grab these guys. Having said that, the diet cannot be TV only, the diet will be a mix of YouTube, Netflix, a [00:22:00] couple of broadcasters. And there you go. And the question is gonna be how do you make sure you're amongst those, five, four or five apps people are using. Evan Shapiro: It seems very unlikely people are gonna use more than four or five apps. That's been the history when we had a thousand channels, we only use four or five channels. Marion Ranchet: Yeah, of course. Evan Shapiro: Now all the research demonstrates of Marion Ranchet: ease of use. Yeah. Yeah, for sure. Evan Shapiro: And that gets us to our next topic, which is there was this piece of research I shared on the last episode, which is more than half of consumers now say that the user experience determines whether or not they use a streaming app. Marion Ranchet: Yeah. Evan Shapiro: And so if these local powerhouses, if these local broadcasters are going to be able to capture that younger audience and compete with the global streamers, their tech is gonna have to be pristine. It's gonna have to not buffer. The search has to be good, and it's very difficult to build a bespoke streamer for your tiny little country. No offense to anybody in this territory. Marion Ranchet: No, but it is, Evan Shapiro: But even Germany is relatively tiny. Marion Ranchet: Yeah, for sure. Yeah. Evan Shapiro: Compared to California. Yeah. That makes [00:23:00] it complicated to accomplish this streaming task, it makes our guest who's on, our special guest, the reason why we're in Lyon, his job that much more important and complicated. Should we bring him in? Marion Ranchet: Yeah, let's do it. Evan Shapiro: Okay. Bedrock Streaming CEO Jonas Engwall. Thanks for bringing us here. You've given us a reason to come to Lyon. Enjoy the food and the wine. Thank you very much. Jonas Engwall: Thank you for having me. Evan Shapiro: What is bedrock streaming? Why was it born? Where did it come from? Why does it have a place in the world? Jonas Engwall: Before I go there, if you don't mind, I was listening a little bit to your conversation and I thought, it's more of an anecdotal story, but I think, and you were also saying that Europeans are a bit apologetic and et cetera, which I think is true by the way. I think it's funny because if you think back in, I'm not sure if you remember this the way I remember it, 15 years ago, when we spoke about [00:24:00] streaming in Europe, everyone talked about rules around streaming. Like what content can go on streaming and it, that was based on what was on Netflix. Yeah. So it was movies and like serialized kind of series that had very strong kind of connectivity throughout the episodes and it was, it's very funny. Evan Shapiro: Yeah. There was no reality show. Jonas Engwall: Yeah. Reality was the no-no Evan Shapiro: Game shows Jonas Engwall: No sports stuff. Like a lot of stuff for no-nos. Basically. It's funny now, and at a time it was like, yeah, for streaming we have to have different content and all of these completely banana ideas basically. And now as it turns out, I would say Netflix is actually coming more our way. The other way. Marion Ranchet: One hundred percent. Jonas Engwall: Both on the content side and on advertising. So like all the things that Evan Shapiro: Yeah, sports, live, ads, they're becoming basically a broadcaster. Jonas Engwall: Yeah, exactly. And I just, the way I look at things is streaming is tech, and content is content and it just happens that streaming is a way better [00:25:00] way to discover, and experience content. Coming back to, Marion Ranchet: At the end of the day, people still want the same things. Jonas Engwall: Exactly. Ultimately, you're transporting content in front of eyeballs. But in a better way. So coming back to your question, what is bedrock and why do we exist, basically. Bedrock in its current form, its name and its structure, was born in 2019. Back then, RTL part of Bertelsmann and also MC, et cetera. Had, depending how you count, four or five different screen platforms. And they were built around the premise of European broadcasters where everything was done separately, right? Like the French guys would build their French channels and their French platform. The Germans would build theirs and everybody else would do their own, right? That's how I think people look at broadcasting in Europe. Part of that is right because you have language barriers and different, but when it comes to tech, it just doesn't apply, and we [00:26:00] are born out of two simple principles. Back in 2019, I was always arguing that you can, whatever country, pick any country you will, but don't worry about your old enemies, so to speak. Your end users that are using your stream platform are not bothered about those guys. They're bothered about, are you at the same level as a Netflix, as a Spotify? Evan Shapiro: So you mean, you're saying for a French broadcaster slash streamer, stop worrying about competing intramurally in France. Think about competing with Disney and Netflix. Jonas Engwall: Especially when it comes to an experience around streaming. So back then, again, no offense and the times are different, but back then, I would say, generally platforms were glitchy on a weekly basis. They would go down. They were totally different from a Netflix. Netflix yes, they've had issues, but generally it's pretty stable and robust. And so basically, we were saying that the end users expect [00:27:00] you in France and Germany and all the other countries to be as good as the prime. Evan Shapiro: Do you think that, do you think that was because they were content first, tech second and they, that was the approach to the platform is we're gonna be so picky about the content environment we're not spending as much. To your point, Netflix is a tech company that added content to it. Jonas Engwall: Yeah, exactly. Evan Shapiro: Amazon is a tech company that added content to it. Disney is not a tech company, but they bought a tech company before they launched. Jonas Engwall: I think it's just, it was part of the DNA, it was just like, they were so used to looking left and right within the country to their competitors. So it was just unnatural to, to compare yourself from a platform perspective outside of the country, so to speak. That was just natural behavior. Nothing wrong with that, but I think it's just, it doesn't really translate that well in the streaming and tech environment. So we were very clear. We said, look, the bar is not set by the French players. The bar is set by the globe [00:28:00] players Marion Ranchet: Or any players for that matter. Jonas Engwall: Yeah. So that you have to play, that's where you have to be if you want your content to be delivered and shine in a global context. So that was number one. And then we said to get there, I was a hundred percent convinced you can't get there until, you can't reach the scale needed in any European country. In any one European country. And I, and frankly at the time, which I think I'm getting proven wrong, but at the time I said outside of China and the US and India, you have, I was basically making the argument that those countries have enough, have scale in one country. And I think, in the US, more that, that's not the case anymore. So I was saying there's no way for European players to do this separately in every country you have to reach scale one way or the other. Evan Shapiro: So at the time you're working where? You're working for RTL? Jonas Engwall: This is back in 2019, I was working at RTL group at the time for a couple months. Evan Shapiro: And just to back up for those who are [00:29:00] uninitiated, so RTL Group is a German broadcasting and media company that has lots of things that they own across Europe. And then Bertelsmann sits. That is the parent of RTL. Jonas Engwall: Yeah. Bertelsmann you add Penguin Random House and a lot of other assets on top of that. Evan Shapiro: But then to go into TV, you also, they also own M6, which is a French broadcaster. Jonas Engwall: Yeah. Correct. Evan Shapiro: So you had German and French broadcasting systems in internally inside this one company. So you're working in RTL? And you're saying. Try, don't try to build these things in silos in different countries. Unify resources to create scale, to compete on a global way. Jonas Engwall: Absolutely. And by the way, I was brought in, I didn't, the concept of doing this in a smarter way had already, reached the group, RTL group management. So that's why I came into the picture. And we were just, at the time, they were like spending double digit millions on all of these platforms. So in total, Evan Shapiro: At different divisions. Jonas Engwall: Exactly. In [00:30:00] total for RTL group Evan Shapiro: Sounds like paramount. Jonas Engwall: Yeah, exactly. They were not spending low amounts of money. But they were just spending it in a very inefficient way, redoing so I, at the time, we were saying like, you're spending like, 60 plus million. Actually, any one consumer only sees 15, so that's a really bad way to spend money, right? And so we said, look, we're doing this the wrong way. We should really pool our resources and build something that is really strong and make that money work in a better way. So that's the birth of what Bedrock is today. Marion Ranchet: So that in, that's the name right? That's the name. Jonas Engwall: Yeah, exactly. Evan Shapiro: So that, that became the bedrock that became the Bedrock streaming platform Yep. For all the RTL group enterprises. Yes. Jonas Engwall: Now what you're saying is true. It's just that it's, that's a five year. Yes. That's a five year. Evan Shapiro: It took five years to get there. So in, and so you were laboring away at that, at RTL to get to that point, but then you realize that you're mastering it. So RTL [00:31:00] Plus be being one of the products and you're gonna be building out features for business with all of your current clients. But then you decided, or the company decided to spin Bedrock out Yeah. And become its own white label product for other players around the world. You had gotten so good at creating scale amongst all these different divisions that you are now ready to offer this product to everybody else? How's that going? Jonas Engwall: So I would say quite good. We have a lot of interest and we do things, in a, I would argue, very strategic and paced way, so to speak. We as a, I'll give you an example. In 2019, when I said to Thomas, Rob is the, he's, he has a lot of roles, including the CEO of Bertelsmann and also CEO of RLT Group. He, I told him, look, if we're doing this, we're doing this right. We're gonna build a platform that really truly can compete with global giants and can be on par with those, and that's gonna cost this much [00:32:00] money. And we said, if you wanna do this right, this is how it's gonna be. Marion Ranchet: This is, yeah. Jonas Engwall: And. We're gonna, we're gonna end up Bedrock, we're gonna be basically losing money because we didn't have enough partners around the table to recoup that money that it really took. But that to me was the right way to go at it. And this is the benefit of having really long term stakeholders, right? Yeah. So the group, they take this very seriously. They're pivoting their legacy business, which is a six, 6 billion kind of business into streaming. So obviously you want to get it right. So this made total sense. So I think that this is, so what I wanna say was this is we do things and we do things at a certain pace, at a certain way that we are making sure that we are creating value for the stakeholders around the table. So yes, we will have external people coming in, but not at the detriment of the existing partners, right? So we're very cautious. We, I talk about a responsible [00:33:00] growth. We could earn way more money than we're doing today, but we want to do this in a responsible way. We want that the people come into this kind of community or streaming kind of ecosystem that we have in a way that it. It creates value for them. It creates value for us and it creates value for the existing partners. Because that's really important for us that we have a, we, because we are a super close knitted group. We're really collaborating around streaming. We're, it's, we operate in a very different way. Evan Shapiro: Yeah. It's, we were talking about this earlier. You guys are weird. You're pretty strange. Jonas Engwall: Yeah. I agree. Evan Shapiro: That you turn money down, you turn clients down. Because, and as you just explained, so you have these corporate owners who you were born out of, who you feel responsibility for. But mostly as a platform. Jonas Engwall: Yeah, absolutely. Yes. Evan Shapiro: You wanna keep fiscal responsibility there, but ultimately their product can't fail. Jonas Engwall: No, exactly. Evan Shapiro: And so what you don't do is running around the planet building bespoke products for a whole bunch of different people. Jonas Engwall: Absolutely. Exactly. Evan Shapiro: People have to buy into the Bedrock Platform. The [00:34:00] Bedrock concept. The Bedrock ecosystem. Marion Ranchet: And it's a bit like a democracy because we, Jonas Engwall: Europe. Marion Ranchet: Yeah, exactly. No, but we Evan Shapiro: Socialism. Marion Ranchet: Okay. Again, every time he says that. Evan Shapiro: That's true. I mean, I covet it. Marion Ranchet: Yeah. Yeah. But like to the point you were making, you can't have anyone joining because you, we're talking about tier one players from each of those markets. And so when you're looking Jonas Engwall: A good fit. Marion Ranchet: You speak. Yeah. The platform and the products everyone has a say is my understanding. Yeah. You know what matters to each of those. And you are then looking to build what works for all, meaning that you wouldn't necessarily do one feature if it benefits only one partner? Is that it? Jonas Engwall: We would still, so to, it's going to risk to get very complicated, but basically simply put, we try to, we try, basically the product is 90% what we called Core. So under the hood, it's, think of a Netflix, virtual Netflix. Like we, their teams are different in every market it looks totally different. The [00:35:00] platform is very configurable. Evan Shapiro: But everybody taps into a core product. Jonas Engwall: Exactly. The core is, there's multiple building examples of this, right? The car industry you build, like you have a core and the different end products look different and different price points. But, so we have a 90% what we call Core, which is highly configurable. So what I mean with that is, we have players that are SVOD players that, let's say focus on video. We have players that are AVOD and now hybrid. They have live, FAST, normal VOD content, podcast, audiobooks. So we have a breadth of content ways, we have a breadth of ways to monetize. And then also the look and feel. So a general misconception is, oh, so we have to like, look, we're gonna lose our look. We're gonna -- not at all. So like the French end consumers, they don't know that they're on the same platform as the Germans, right? Because it looks totally different. It doesn't look, yeah, it speaks to you in a different way. It just, and it monetizes differently. It has different content. Everything is [00:36:00] different. But, the core of that, so said differently, when we evolve the platform. So generally we don't have difficulty to align people. The timing is a little bit Marion Ranchet: Yeah. It's, they're more or less advanced. Because M6 Plus just relaunched less than a year ago. Jonas Engwall: Exactly. Marion Ranchet: Brand new streaming vehicle. Jonas Engwall: Yeah. Marion Ranchet: RTL Plus video. They've been at this for exactly many more years now. Jonas Engwall: So that you have a little bit of shift in timing, but that generally we do a pretty good job, I would say collaborating around this. And what we do, and this is not rocket science, this is, we build the feature one time and then it's available. Evan Shapiro: Yeah. To everybody, whether they choose to use it or not. Jonas Engwall: Exactly. Then they can say, I don't want it. Yeah. Evan Shapiro: I think the car analogy is a good analogy. Which is imagine if you could tap into an engine that was road tested a thousand miles at a thousand miles an hour forever. That, you're able, or into your point, tap into a Netflix-scaled product for your business, which you can change the front end. Jonas Engwall: Make it feel like what you want it to be. And I talk about this, I use the [00:37:00] analogy of a Lego. You know, when you buy Lego for kids, you can buy Lego and it turns into a Star Wars thing, or it turns into a firetruck or whatever. Marion Ranchet: Make it your own. Jonas Engwall: So like it's ultimately Lego, but it's created differently, right? So, that's what we do, right? We, for every client, we create a Lego for that client, and that's a, that's work we do upfront and we will create templates and font and we will convert their way of engaging with the user into the visual persona, so to speak. And then that will, then, once that is done, they can play around and do stuff with that. Without us and change it on a per day. Whatever they can create, I don't know. There's a football match evening. Evan Shapiro: They have their flexibility to do what the product what they want to do on a daily basis. Jonas Engwall: Exactly. Evan Shapiro: But at the end of the day, the product itself, is road tested and it's run in a collaborative way. The way that you talked about it is very interesting as a democracy. I see it as a bit of a collaborative community. Jonas Engwall: Yeah. I agree. Evan Shapiro: Everybody sits around and says, these are the [00:38:00] features we want. Let's talk about what's good for the whole. And I think that kind of radical collaboration, which I've been talking about for a while, is so rare in streaming these days. Marion Ranchet: It is essential here, again, to gain scale. And I'm sure that, like the German or the Dutch are actually learning from M6 because they started a year ago and I'm sure from day one, they came into this business with things that maybe were not possible five years ago. Jonas Engwall: Exactly. Marion Ranchet: Can I ask you something on the platform excellence? So are we on par, with the global guys? Are we there yet? And step question, what do we have maybe that they don't or what do we need to work on? What are you seeing? Jonas Engwall: I think in terms of being on par, it's really difficult to answer that question. I would say, and it's a moving target, right? Marion Ranchet: Yeah, sure. Jonas Engwall: So I would say in certain areas, yes, and I think in certain areas we're still not there yet, which I think is okay. It's, this is a journey we're on. And [00:39:00] what yeah, differences, I mean, and to a certain degree, what you were talking about before. I made this point to our stakeholders multiple times. As in back in the day, we had a tougher job than Netflix. Because Netflix had one, one product. It was VOD. SVOD. Marion Ranchet: Yeah. Jonas Engwall: And we have SVOD, AVOD, hybrid, linear channels. Evan Shapiro: Yeah. I just talking about, you have a much more difficult lift with these streamers here. Jonas Engwall: Yeah. They're catching up in the sense that they're also, Evan Shapiro: They're adding all these other things. Jonas Engwall: Yeah, they're adding sports. They're adding, Evan Shapiro: But they don't have a linear product and they probably never will. Jonas Engwall: Yeah. Maybe not. And I actually think that, and this is RTL Plus has been championing this, right? The having multiple content categories in one place. So podcasts, audiobooks, and stuff like that. You could, Marion Ranchet: They are lifestyle bundle and you like to talk about lifestyle, they have magazines. Evan Shapiro: To me, that's where it out. Marion Ranchet: Yeah, absolutely. Jonas Engwall: And I, you can argue what the categories are and they will differ between countries and stakeholders, and of course. With Bertelsmann, they have lots of audio. Yeah, there are lots of books and [00:40:00] audio books. So that makes total sense, but might not make sense in a different market. But I think that the concept of combining content is now slowly becoming a trend. Because you see, I would argue you see Netflix, they have gaming. You have Prime, they have podcasts and audio. Evan Shapiro: They're talking about doing podcasts. Jonas Engwall: Yeah, exactly. So like the, and you have Globe in Brazil, you have players in Middle East. And then I think the concept is good 'cause it reduces churn. And to your point, there's only so many apps one single user is going to have. Marion Shapiro: That you want to play with. Jonas Engwall: So if you have, if you can discover extra value within that little ecosystem, you say, oh, great, I can actually get my podcast here. I don't need to go. Evan Shapiro: And consumers keep saying, I want one bill, I want on e location. I don't want have to keep logging in and out of all these things. Marion Ranchet: I wanna do one thing. Evan Shapiro: That's said they're gonna chase the content wherever it goes too. I will say, when I was building, so I built a streaming service called Seeso, RIP, and when I bought the streaming backbone, which is pre-Bedrock, the [00:41:00] idea that I would be able to go sit around a table with this, vendors, other clients and compare notes. That would've scared the fuck out of them. There would've been no way. They would've no, like you can ask them for a reference but don't compare notes. Because they were charging different people. You said this earlier. Charging different people different things and making money off of A, so they can do it cheaper for B, that's not how you operate your business. You're, you operate this weird collective where everybody sits around the table and says, these are the features we want. We operate together. Like it is so refreshing to hear that approach. I wish that I had access to something, some kind of collective where I could compare best practices and compare feature sets and then here, yeah, that 10% that you're fucking around with all the time with your designers in Guatemala or wherever it is, that's really not doing any, in fact, it's complicating your product. It's increasing churn, it's increasing fall off, concentrate on the core engine. Jonas Engwall: And you get, to your point, right? You get exponential [00:42:00] innovation happening because in a traditional model, you have to innovate. You have to innovate, you have to Evan Shapiro: By yourself. In isolation. Jonas Engwall: Yeah. You're alone. Whereas here, and this, we have practical examples. We discussed something, it came up, okay. Should we have vertical, short form content? M6 says, yeah, I really like that. I'll bet that's gonna work. And the others go, yeah, I think that makes sense. But M6, you go first. In this case, right? So in some cases they all jump on it. And in this particular case, M6 was first, and this is not about, you know, hard feelings or anybody pushing the other one in front. It's just genuinely, they were super excited and the others were a little bit less excited and, okay, this is great because then M6 goes off and tests and Evan Shapiro: They get the data back. Jonas Engwall: Yeah, exactly. Evan Shapiro: And everybody gets to see how it works. Jonas Engwall: Exactly. Marion Ranchet: The benefit of the collective. Jonas Engwall: Yeah, and in this particular case, it turned out to be awesome because the conversion rate is sky high between the short form to the long form. So M6 said, okay, we're doing this with, most of all content. Yeah. And the other guy said, okay I want this. Marion Ranchet: Okay. I am doing that. [00:43:00] Evan Shapiro: In a normal circumstance, they would've seen M6 launch it. Gone, well, that's not gonna work. Marion Ranchet: Or a competitor. Evan Shapiro: And then it works. And they're like how do we scramble to do this? Now it's just Jonas Engwall: We go click. It's a little more complicated than that, but you know. Evan Shapiro: But it's ostensibly now a feature on the car that I can choose to add without breaking everything. Jonas Engwall: Exactly. Evan Shapiro: So it is really refreshing. Marion Ranchet: Can I ask you something? 'Cause at the top, we were talking about how there's no, so we, there is no European streaming service. You know, a pure player. Like a Netflix. Jonas Engwall: Correct. Marion Ranchet: A version of Netflix in the region. And that's also because we're a piecemeal of a continent, so Evan Shapiro: Not a country. Marion Ranchet: Yeah. Evan Shapiro: I learned that today. Marion Ranchet: Yeah. You learned that today. There's an atlas, so you can take it home. I kid you not, there's an atlas with a Europe one written on it. Evan Shapiro: I just speak English wherever I go though. That works for me. Marion Ranchet: Yeah. We're getting better at this. Jonas Engwall: We're getting better in English. Marion Ranchet: Yeah, we're getting better. No, my question is, if we don't have a front end or, a D to C brand being the pan-European [00:44:00] vehicle, can we expect maybe some sort of collaboration in more markets, consolidation? And then the pan-European platform is not the D to C, it's the tech underneath? Jonas Engwall: Yeah. Evan Shapiro: That's ostensibly what you've built. Marion Ranchet: That's what you're trying to do, right? Jonas Engwall: Exactly. That's where we're going. Evan Shapiro: It is pan-European. It is Pan-Global. It is pan territory. Jonas Engwall: We will go outside Marion Ranchet: It's still a few number of countries in the region though, right? So Evan Shapiro: Today. Marion Ranchet: Yeah, today. Yeah. Yeah. No, absolutely. Jonas Engwall: We are, we're decent numbers. So just to give you some numbers. In a few months we will cross over 500 people and they're mainly tech guys. Product of course. We operate, today, this is before Germany. We have 45, 50 million users on the platform. We offer the content is, like I mentioned before, all kinds of content including audiobooks and podcasts. We have 60 devices. We cover pretty much most devices you can think of. So for every additional thing we add to the platform, it [00:45:00] makes it so much easier to move into the next territory. And I think you're right. I don't know if there's gonna be, I wouldn't bet my money that it's gonna be a D to C, the European, whatever brand that is, but I do think that Bedrock will power a lot of players in and outside of Europe. So yes. Evan Shapiro: Allowing them to use the power of the platform you've built. Jonas Engwall: Exactly. Evan Shapiro: To compete with the global players. Jonas Engwall: And just to give you one more number, like we spend between 16 and 80 million every year on tech. And we can then basically distribute that cost across multiple players. It would be very difficult, or at least minimum economically difficult to justify to spend 80 million in one country. Marion Ranchet: Especially right now. Jonas Engwall: Exactly. Marion Ranchet: Everyone is looking to be Evan Shapiro: To cut it back. Marion Ranchet: To cut back, be profitable. And so you, something's gotta give. Jonas Engwall: So, if you look at the, I was saying in the beginning, RTL Group were spending like [00:46:00] 60, 70, whatever, million in total, but the output from an end user perspective was like 15. Evan Shapiro: Because they only touched a certain product. Jonas Engwall: Exactly. And now it's the other way round, like where the output for the user is really high. And so it's a, it's far away. Evan Shapiro: And that is another element of, again, as a recovering buyer of these products, right? I used the inefficiency of every buyer building their own product. It just seems bonkers from this side of it. But until you said a lot of this stuff that we talked about earlier, like it's hard to conceive of me tapping into a product that we all use is gonna benefit all of us. But it does. Jonas Engwall: Exactly. It does. And yeah, it makes total sense and again, it acts and engages with your user totally different from one country to the other. So it's not, that we're trying to cram everything into something that nobody wants. It's generally hyper flexible within those 90%. Evan Shapiro: But it's the operational [00:47:00] scale that truly matters. Jonas Engwall: Exactly. And it also gives peace of mind, right? Because we operate at scale. We have money to invest into stability, scalability. Again, that is it's one thing to build a platform for a couple hundred thousand people and for a couple of million and 50 million, that's a totally different challenge. So yeah, so I think people underestimate. And it's not just the bonkers way of rebuilding stuff. You also find the people. Like it's you, you have to then Evan Shapiro: The experts. Jonas Engwall: Exactly. There's only so many experts out there. Evan Shapiro: There's all this parallel work out there. Jonas Engwall: In Europe at least. So if you can Evan Shapiro: And only so much bandwidth, and that's the thing. It's like I'm waiting, I'm, it's in the funnel, it's on the roadmaps, it's in the funnel, it's on the roadmap. You have one combined roadmap, one combined funnel. Well, this was great and I think Marion Ranchet: Super interesting. Evan Shapiro: You're right. I think, if we're gonna come up with a pan-European, it is the back engine that's gonna wind up being pan-European. I think Bedrock, Jonas Engwall: I think so. Evan Shapiro: Is positioned well to be that. Thank you. Thank you for coming, for giving us a reason to come to Lyon. Marion Ranchet: Yeah. Thank you. Jonas Engwall: Please come back. Marion Ranchet: Yeah. Evan Shapiro: What did you [00:48:00] think? It, was it good? Marion Ranchet: Yeah. Evan Shapiro: A, we should say, in person again. Second time only. Marion Ranchet: Oh, in person is so nice. I feel like I'm on a chat show. Evan Shapiro: Your living room is super nice. Marion Ranchet: Yeah. So maybe I will actually do this from my couch at home next time. We should think about that. Evan Shapiro: I'll do it from my couch. Marion Ranchet: Yeah, let's do that. Huh. Evan Shapiro: Well, this was great. Thank you much. Marion Ranchet: Thank you so much for coming. Evan Shapiro: Thank you for giving me my European lesson. This was great being in person. It was great being in Lyon. Where can we see your newsletter? Marion Ranchet: Streaming Made Easy is on Substack. How about yours? Evan Shapiro: It is Media War and Peace, also on Substack. Thank you all for being here this week. It was great to be with you in Lyon. We'll see you soon. Marion Ranchet: See you next time.