Sky, Europe’s biggest pay TV operator, looks set to launch its Now TV on-demand streaming service in Spain, before offering the service to other parts of Europe, beyond its core markets – U.K., Ireland, Germany, Austria and Italy.

The Now TV launch in Spain, which Sky is looking to push through by the end of this year, according to one source, signals the pay TV giant’s determination to test the waters for its own OTT video streaming operations beyond its five-territory base.

It is “almost inevitable” that Sky will go into multiple European markets with Now TV OTT streaming offers, said Guy Bisson, research director, Ampere Analysis.

Sky CEO Jeremy Darroch told Variety in March that Sky was “thinking” about going into other markets, outside its core five in Europe. “There are things like our OTT product that we are developing which we can take to other places,” he added.

Sky’s launch in Spain comes at a time when market indicators for the Spanish pay TV market are improving sharply. Posting second-quarter 2016 GDP growth of 0.7%, more the Germany’s 0.4% and France’s zero growth, according to Eurostat, Spain is growing faster than any other big economy in Europe.

After years of languishing pay TV take-up as rampant piracy withered an already-low subscriber base, telco Telefonica – through its acquisition of Spain’s biggest pay TV operator, Canal Plus — has put the country’s pay TV market into turnaround. Boasting just 650,000 pay TV subscribers on June 30, 2013, it had 3.8 million at the end of June this year for its pay TV service Movistar Plus.

Subscription VOD services such as Movistar Plus’ own catch-up/pay-per-view platform Yomvi has grown fast, although from a low-base.

“From a market that was stagnant or in decline with major structural issues, Spain has turned into a strong growth territory,” said Bisson.

Sky’s Now TV Spain launch doesn’t look like a cake walk. Reporting on Sunday on the Now TV launch, British newspaper The Telegraph said Now TV will be priced in Spain at around €10 ($11) a month. But the success of Now TV launch in Spain “won’t depend so much on its pricing as its content,” said Irina Kornilova, senior analyst, IHS Technology.

The big questions now are: What content Sky can offer in Spain?; and will Sky now seek to strike pan-regional European licensing deals for more than its core five territories?

“If they launch it in a new territory they need to buy broadcast rights and if they want it to have a relatively high profile they will need to spend significant amounts,” said Francois Godard, at Enders Analysis.

Sky always operates with a strong domestic soccer anchor, Godard noted, but Premier League soccer match rights are already tied up in Spain with Movistar Plus.

A huge weakness for Now TV in Spain would be that it couldn’t offer HBO shows as it does in the U.K. HBO announced May 26 it had pacted a carriage deal with telco Vodafone for HBO España, HBO’s own upcoming streaming service for Spain, which is due to launch by the end of the year. First-run rights to current and future seasons of “Game of Thrones” and other currently airing top series at HBO are locked up in an HBO output deal with Movistar Plus.

Like Netflix, Sky can offer its original series in Spain, but Sky may well now be on the market for third-party content for Spain. “Sky doesn’t have as much original content as Netflix does,” Kornilova noted.

Telefonica’s Movistar Plus has officially announced three original TV dramas since January 2015, when the paybox unveiled ambitious plans to air eight original premium TV series a year starting 2017. Launching in Spain last October, Netflix has to date placed an order for one original series, “Las chicas del cable,” a 1929-set dramedy from Bambu Producciones. Its first season will be completed next year.

Sky’s Now TV launch in Spain may also be a race to the start-line with other U.S. and European OTT services.

France’s Vivendi is one of those in the pan-European race. Its play to buy all or part of Mediaset Premium, the pay TV unit of Silvio Berlusconi’s Italian broadcaster Mediaset, now looks on hold after a very public disagreement about Mediaset Premium’s valuation. But Vivendi has also held conversations with Telefonica to partner on pay TV in Spain, Europe and Latin America, though there is no public indication these talks have yet come to fruition.

Sky’s Spain move marks just part of a larger pan-Europe drive. Closing its landmark multi-year pan-European deal with Sony Pictures Television on new and future Sony movies this April, Sky negotiated subscription and transactional rights to Sony movies in the territories in Europe where Sky offers traditional satellite services — U.K., Ireland, Germany, Austria and Italy. Sources say it will now seek to secure pan-European rights to at least these five territories when renewing contracts with other Hollywood studios.

The Sony deal could well prove to have been the first phase in a pan-continental approach to dealmaking designed to feed a truly pan-European pay TV network.

Emiliano de Pablos contributed to this report