Balancing the key distribution platforms of its flagship channel and VoD service is key to the future of the Czech Republic’s TV Nova, says CEO Daniel Grunt.

2024 marks the 30th anniversary of the Czech Republic’s TV Nova, as the commercial broadcaster continues the “transformation strategy” it began last year, according to CEO Daniel Grunt.

Grunt, who is also chief digital officer at TV Nova parent company Central European Media Enterprises (CME), says the key element of this strategy is to overhaul the operation so that linear TV no longer accounts for the majority of its business.

Launched in February 1994 and one of the first national commercial broadcasters in Central and Eastern Europe (CEE), TV Nova currently operates a flagship channel, six pay TV sports channels, five other thematic channels (Nova Cinema, Nova Fun, Nova Action, Nova Lady and Nova Gold) and streaming service Voyo.

While the digital transformation is underway, Grunt says the linear advertising business must be retained in order to finance the change. Meanwhile, there must be a “focus on building a content and marketing strategy that allows us to maximise the reach of our content. It doesn’t matter which platform it is on, whether it’s through linear or Voyo.”

However, there are “a lot of consequences” to embarking on this course, admits Grunt.

Firstly, it must be measured, and as there is no official way of doing so, one has to start the process. Secondly, a monetisation strategy must be put in place that does not cannibalise the various parts of the business but ideally “sets up a structure that is moving people from linear to OTT viewership” and guarantees that monetisation per household is higher than from linear services.

The third factor to address is branding. Nova, says Grunt, is already the strongest brand in the country by far and the task is to “put together clear positioning and definition of all brands we have in the family.”

Lastly comes human resources and the question of “how to establish Nova as an organisation of first choice if you want to work in the media business,” he says.

“In a nutshell, we started the transformation strategy of TV Nova last year and a lot of things have already been done.”

Voyo, for instance, had a very successful year and ended it with a combined total of more than 680,000 subscribers in the Czech Republic and Slovakia. This represented year-on-year growth of 51%, or almost double the market’s 26%.

Moreover, the streamer had its first profitable year, with a double-digit profit margin.

Grunt notes that while there is high potential for cannibalisation between linear and Voyo – as most viewing on the latter is of TV content offered in advance and without ads – TV Nova fortunately continues to grow its TV share and has increased the gap with its commercial competition by one percentage point in both primetime and all-day.

It has also strengthened its secondary (thematic) channels, as shown in February when the company launched Nova Sport 5 and Nova Sport 6, offering viewers coverage of Formula 1 and MotoGP, among other sports.

Grunt believes that an important factor in TV Nova’s success is the strong start it made 30 years ago, being “a completely new thing for Czech people.” Its strengths lie in the talented professionals it employs and its brand, as well as the fact it understands ordinary Czech people. Another factor is its news output, which is “the strongest and most viewed in the Czech Republic.”

Looking more specifically at its schedule, Grunt says Nova’s main channel usually has higher ratings in primetime than its two main competitors, TV Prima and Ceska Televize, combined. “The reason is investment in premium-quality original production,” he claims, underlining the success of two strong slots it opened up last year, on Sunday and Monday evenings.

These slots are allocated to crime series. On Monday nights, the channel airs Specialist (Specialisté) and Criminal Department Angel (Kriminálka Andel) in the spring and autumn seasons respectively, and on Sundays it carries several shows during the year, including Police Modrava (Policie Modrava).

Meanwhile, on Tuesdays and Thursdays, it offers long-running shows and on Wednesdays has had success with series including entertainment formats Wife Swap and Master Chef, in the latter case on both TV and Voyo. Later this year Nova will broadcast Hell’s Kitchen for the first time in the Czech Republic.

Grunt says the suggestion that classical linear TV is dying because of VoD/OTT does not really apply in the Czech Republic. Last year, for instance, saw the launch of a new national terrestrial channel called A11 and, more recently, the free-to-air (FTA) channels Sporty TV and Warner TV also made their debuts. Another two or three terrestrial channels are planned for later this year.

Equally surprising is the fact Warner Bros Discovery switched its strategy for Warner TV from pay TV to FTA. Indeed, the Czech Republic is only the second country after Italy where Warner TV is available as an FTA service.

As Grunt points out, terrestrial still accounts for 45% of the market in the Czech Republic. “It’s very strong for sure,” he comments.

Grunt believes the biggest challenge faced by the industry in the Czech Republic is declining TV ratings. Fortunately, the rate of decline in CEE as a whole is much slower than in Western Europe. “We are very stable compared with that,” he says, adding that, as a result, the group has “much more time to adapt to the new type of business and balance it with classic linear TV.”

Grunt is responsible for Voyo in all six countries in which CME is present and says the service’s relaunch, which took place three years ago, has been very successful. As of April, it had around 1.2 million paying subscribers, of whom 820,000 were in the Czech Republic and Slovakia, its two strongest markets.

Voyo is also in a strong position in Slovenia, where it is running neck-and-neck with Netflix, he says, adding: “There is huge potential in Romania, where we are starting to focus now after the successful restart in the Czech Republic and Slovakia.” Voyo also made its debut in Croatia in 2023 and the focus next year will turn to its operation in Bulgaria.

Interestingly, Voyo underlines the differences in audience tastes across the region. While crime series do extremely well in the Czech Republic, more “emotional” and dramatic content fares better to the east (Slovakia) and south (CME’s remaining markets). Furthermore, in the Balkans, says Grunt, “Turkish content works much better than in the Czech Republic, for instance.”

Looking to the future, Grunt says he regards Voyo and the Czech Republic’s Nova as one. “The key task is to balance these two distribution channels and monetisation pillars together,” he says.

This will involve spending more money on quality local productions for both, as well as continuing to build their brands – in Nova’s case, the flagship rather than secondary channels. The internal processes at Nova are also being changed to make them more flexible, allowing it to “quickly react to what is happening in the market.”

Grunt adds that the group is evaluating when will be the right time to introduce an ad tier to Voyo. However, this is unlikely to happen this year or next “because the market is still growing so fast and we are focusing on grabbing as much as possible from the market.”

He also feels it is important TV Nova increases its linear advertising business significantly this year, representing a cost-per-purchase growth of 18%. “What is great for us was the market understood that TV is slightly declining. And we are investing much more significant money into content production and acquisition.”

TV Nova will also continue strengthening its long-running series on Tuesdays and Thursday, “which is very important for the stabilisation of the business,” he adds.