Rakuten TV Boss Talks FAST Channels, Streamer ‘Frenemies’

Rakuten TV CEO Cedric Dufour is a relative newcomer to the entertainment industry, having previously worked as Rakuten’s e-commerce managing director for Europe. But Dufour has settled quickly into his new post since taking it up eighteen months ago, ascertaining the lay of the land as well as its inherent contradictions.

“What I noticed is that, for example, the studios, which used to be our main partners, [are] also our competitors,” he tells Variety. “Because they all have their own platforms. The manufacturers also – Samsung, which is one of our big partner, is also a competitor, especially on Samsung TV Plus, because our channels are competing against their channels. So we really need to understand in this world of frenemies what is our position, what is our added value, and we need to anticipate what will be the evolution of the market to see how we need to position ourselves in this market.”

Unlike many of the company’s competitors, who are chasing original and exclusive content to lure in new subscribers, Dufour’s watchword is “quality.” Rakuten TV already offers TVOD and AVOD and its latest venture, unveiled last month, is the launch of two new FAST channels, one for reality/factual and the other for crime. “We want to build a trustworthy brand so that when people go to the Rakuten TV channel, they know that they will find good content, relevant content,” he says of the new FAST channels. “It’s the case for our own channel, but also with third party channels that we are distributing on our platform.”

Read on for Dufour’s take on the industry pivot to FAST, Rakuten’s USP and the future of streaming.

Do you feel like the market for FAST is getting saturated?

Not yet. But clearly, there is a profusion of content, and there will be a big difference between the platforms. In our case, our priority is quality of content rather than quantity. So in terms of channels, we are distributing around 500 channels throughout the 43 countries we are operating in. We could do 1500 but the idea is to select the right channels, the good content, and that’s our differentiation compared to other platforms.

Rakuten originated in Japan, where it also operates a streaming service. Does it work closely with its European streaming operations or are they quite separate?

It’s very different. We run [Rakuten TV] from Barcelona and we have people in different countries to make sure that we have the relevant content for each country. Rakuten TV also operates in Japan, but with a different business model. So it’s quite separate.

Why has Rakuten chosen this more localized approach, especially when compared to someone like Amazon, which also began life as an internet retailer before moving into content.

First of all, Rakuen doesn’t have this same presence [across the world] as Amazon. In e-commerce, apart from Japan, we have also a marketplace in France, Taiwan and that’s it. We don’t have the worldwide coverage that Amazon has. We have many other businesses in other countries; we have other digital content, we have the Kobo e-reader business, Viber messaging, but we don’t have the e-commerce everywhere. So that’s why we had a different approach. And we really think that’s one of our differentiations compared to others is to have this localized approach to make sure that we have relevant content.

Do you think the market for streaming platforms is overcrowded?

It is a crowded market. And also one mission we have – and it’s not only our mission, but the one of the industry, I think – it’s to work on the discoverability. So even if our approach, as I mentioned, is more quality than quantity, even with the quality we have, on our platform we have [a lot of] content available. So we need to help the users to find the relevant content. That’s an important challenge because sometimes people struggle in finding the right content they want to watch.

Does Rakuten do originals?

Yes, we do. We started six years ago. At the beginning, it was mainly sports documentaries, mainly because sports is part of the DNA of Rakuten. We were sponsors of the FC Barcelona team, we are still a sponsor of [San Francisco NBA team] the Golden State Warriors, of the Davis Cup, so it’s really part of our history. And the documentary is a format which is quite relevant for this kind of genre, so we did sport documentary, and now we’ve expanded our Rakuten originals to other genres and to other formats. The way we’ve been able to fund this is to have sponsors and to have brands who want to associate their name with our productions.

Do you feel pressure to make that one breakout series that’s going to get people talking about Rakuten, like Roku did with the Weird Al movie?

I think our mission is more to select the content than having our own content and producing our own content. And given our size and our position in the market, we’ll limit production to seven or eight productions [per year]. So that’s not an obsession for us. We do it if it makes sense, if we find a good story to tell, but the way we grow our market it’s not through this kind of investment. The way we have grown in the last five years was mainly partnering with manufacturers. We have a branded button on almost all the remote controls from the manufacturers and that’s allowed us to be present in 140 million households in Europe, with our button on the Samsung TV, the LG etc.

Do you think there will be as many streaming platforms in 10 years’ time as there are now?

That’s a good question. It’s evolving very quickly. I think there will still be the giants in this market, but there will also be a place for smaller platforms with niche offerings, especially on quality of content. That’s why we cannot fight with others on volume. That’s why we fight on content.

Does Rakuten TV offer live sports?

We don’t. We don’t have live streaming.

Is it something you want to get into?

It’s a super competitive market. So right now, we are not considering it. And especially given our size and our position, our main target is to see how this market has evolved in the future, and what is our position in this market and what makes sense. The good thing is that, thanks to our size, we are quite agile and flexible and we can react. For example, the AVOD service launched in 2018; we launched it in like six months. It was super quick because of our flexibility. We have a small team of 200 people in Barcelona and quite reactive. So we need to keep this flexibility to see what will be our position in the market in the coming years.

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