Divan.tv sees opportunity from Ukraine, no threat from Netflix

Changes in the Ukrainian legal framework for media could give a boost to OTT services, according to Andrey Kolodyuk, founder of OTT service Divan.tv.

Speaking to Digital TV Europe at Digital TV CEE, Kolodyuk also said that Netflix was unlikely to make much headway in Ukraine because of its lack of local content and high price.

From January 1, Ukrainian pay TV distributors will be forced to encrypt and pay for the channels they carry on their services. These were previously part of the so-called universal package – amounting to about 30 channels – and were completely free to view, said Kolodyuk. The legal change will force many of the country’s myriad operators to sign contracts with channels for the first time.

“This is a challenge for them, but an opportunity for us. Divan.tv is already included in the bundles of 40 operators or ISPs. We believe it will bring more business to us and will also increase prices. Ukraine is becoming a true pay TV market,” he said, adding that he expects operators to provide encryption, meaning that the country’s five million pay TV customers will need to make a choice to view this content. He said it would make sense for them to choose Divan.tv, which offers additional content.

Divan.tv allows viewers to skip advertising, which is one of the service’s key selling points, according to Kolodyuk. The service has also highlighted the value of smart TV, he said. Divan.tv has also teamed up with mobile operators to bundle the service with data packages. “This is a key differentiator for us,” he said.

Regarding Netflix, Kolodyuk said the global SVOD platform is “not going to win” in Ukraine as it lacks local and live content. He said the breadth of content on his platform at a lower price than Netflix means that the US service is not a major threat. “They are going to be niche and really for an expat type of market in our region,” he said.