Estonia’s Own Netflix and Modern Piggy Bank: How Technology and Managed Changes Help Stay Competitive
Technological innovations and managed changes play a crucial role in an organization’s long-term competitiveness and business success. More importantly, they are inevitable. Think of it like this: the suitcase was invented a long time ago, and the wheel even earlier, but it took a while before someone thought to put wheels on a suitcase. This innovation led to commercial success and made travel much more convenient.
Image by yousafbhutta from Pixabay.
Today, many companies face similar "suitcase and wheel" questions. They can choose to manage change or continue as before. Those seeking a competitive edge usually find it through innovations. Estonia’s largest commercial bank, Swedbank, and the Estonian Public Broadcasting (ERR) share their success stories.
“If you start developing a mobile app when everyone already has a smartphone in their pocket, you're already too late,” says Tarmo Ulla, Head of Private Segment Division at Swedbank Estonia. “Today, we must act for tomorrow’s customer expectations.”
A Modern Piggy Bank with Over 200,000 Users
There are many examples where technology has enabled changes or improvements in business models. Let's focus on a classic banking service – savings.
Initially, savings were managed at the bank branch, then moved to online banking, and later to mobile banking. At home, people saved money in piggy banks, but with the decline in cash usage and the rise of digital payments, home savings stopped. Swedbank filled this gap with the Money Saver (Rahakoguja) – a modern savings account that accumulates money in small amounts, like the old piggy banks. Customers can quickly activate the Money Saver in the app or online banking, and it starts collecting money from card payments. Saving small, unnoticed amounts adds up to a significant result. “Thanks to Money Saver, customers who said they couldn’t save have found they’ve accumulated a nice three-digit sum,” says Ulla.
While Money Saver is simple and convenient for the customer, launching such technical solutions is not an easy task for the bank. “The banking system is large and complex, and most importantly, it must be very secure. Even small changes, products, or services require a lot of work,” explains Ulla.
To illustrate, Ulla compares it to aviation. “If you need hot water at home, there are many ways to get it, and buying a new kettle is quick and cheap. But boiling water at 11 kilometers altitude involves many safety rules. The water is the same chemical compound H2O, but you can't use a random kettle bought from a local store on a plane. It must be suitable for that environment, tested, safe, etc. The banking system is similar; every change must be thoroughly checked and adapted to ensure security. Ultimately, the bank sells trust – customers trust us with their assets,” Ulla explains.
Today, Money Saver has over 200,000 users. “To stay competitive, we must constantly develop our products and services, and that's what we do. Our goal is to offer personalized digital solutions that provide tailored experiences or improve customer service. Better user experience and faster response to customers enhance our market competitiveness. Technological changes help us gain more market share and create a sustainable competitive advantage,” says Ulla.
The Success of Netflix Means We Can’t Hide Our Heads in the Sand
“Although public broadcasting is not a business enterprise, we are similar to Swedbank in many ways,” says Toomas Luhats, a board member of ERR and the leader of the streaming platform Jupiter. He explains, “When linear TV was the norm, it felt like you had to watch a series when the TV channel scheduled it, not when you wanted to. The importance of content hasn’t diminished, but the role of the channel has.”
With the rise in popularity of on-demand viewing and streaming, ERR could not ignore these changes. “Netflix has shown the clear direction where the world is heading. Public institutions must keep up with the times. When ERR was founded, radio reporters traveled by horse. Today, they use cars or even electric vehicles,” Luhats compares.
Like leaders of private companies trying to predict the future, public broadcasters must also foresee future preferences. “By doing this, we remain reliable, relevant, and necessary. Public broadcasters must be objective beacons, distributing their content. If no one sees or hears it, public broadcasting is useless,” he says. The future clearly lies in streaming, as seen globally. “We’ve observed these trends worldwide and across Europe,” confirms Luhats.
Courage to Start Is Half the Battle
“Before Jupiter, ERR had many different viewing platforms from different eras, quite fragmented and not entirely meeting viewers' needs,” recalls Luhats. Returning to ERR in 2019, he was tasked with building “ERR's own Netflix,” now known as Jupiter. “We must credit ERR’s IT development department, which had already organized file integration, so we didn’t use different types of files for the same content in various departments,” Luhats notes.
The goal was to create a very good streaming platform. “None of us knew where we would end up when we started. Sometimes good things happen thanks to the courage to start,” confirms Luhats. “We’ve had excellent partners, like the design company Fraktal or Devtailor, who programmed Apple TV readiness for us for free two weeks after Jupiter’s launch. When you do something cool and do it with heart, the future is bright,” believes Luhats.
Previously, purchased content – thousands of movies, series, and documentaries – metaphorically sat on a shelf, waiting for TV airtime. With Jupiter, this content is available to everyone at any time. “It’s like opening our warehouse doors to people, allowing daily access to all the fascinating content produced worldwide. Our acquisition team, led by Katrin Rajasaare, had to renegotiate contracts for both linear channels and FVOD (free video on demand) rights with the same budget. Ultimately, we negotiated to include streaming without extra costs,” reveals Luhats.
Today, Jupiter is Estonia’s most-watched streaming platform. “Since launching in April 2020, we’ve seen organic growth. More people continue to watch us, and we’ve grown significantly among young audiences. We are now available on over 90% of new smart TVs with our app, making it convenient for people to watch,” emphasizes Luhats, highlighting the importance of technological solutions.
Of course, this doesn’t mean resting on laurels. “We must strive to be better and smarter, both technologically and content-wise. Limited financial resources mean we must be twice as clever as everyone else to achieve something very good,” believes Luhats.
Why Are Changes Often Slow?
The willingness to innovate is evident at the office of the largest data center in the Baltics, where interactions with dozens of organizations occur. Greenergy Data Centers’ CEO Tõnu Grünberg says technological changes are often slow because of the large investments and fundamental choices involved. “Decision-making requires courage and vision,” shares Grünberg.
A good example is Playtech, which recently announced a collaboration with us, aiming for greater energy efficiency and a smaller ecological footprint. They invested in more reliable and efficient equipment and a greener server room. This positively impacts their business and competitiveness, as the IT world increasingly measures carbon emissions. Besides the product itself, its footprint can provide a competitive advantage,” he adds.
New systems, automation, and digitalization generally improve speed, accuracy, and reliability for consumers. This gives organizations an edge over competitors and enhances their ability to offer innovative solutions. Customer satisfaction is also crucial – technological changes better meet customer expectations and needs.
“In conclusion, I encourage entrepreneurs to embrace change and see opportunities in it. Growth and economic development, which everyone eagerly awaits, lie within,” Grünberg concludes.