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TDG: TV/Video revenues to remain flat through 2020

According to a new report from TDG, The Future of TV Monetisation, total TV and video revenue over the next five years will be much like the previous five years in terms of inflation-adjusted dollars, running primarily flat. Overall TV and video spending has seen minor growth since 2004, rising from $195 billion (2013 dollars) to $213 billion in 2013. This constitutes an increase of only 9% during a 10-year period, equivalent to a compound annual growth rate (CAGR) of only +1%.

According to Bill Niemeyer, Senior TDG Advisor and author of the new report, since 2010 (after the worst of the 2007-09 economic downturn), growth rates of business and consumer spending for TV and video remained negligible. “Total TV and video spending rose only 3% from 2010 to 2013,” says Niemeyer.

For the purposes of this report, TDG employs a comprehensive methodology that includes transactional, subscription, and advertising revenue over a wide range of delivery platforms and consumer use cases.

While new viewing platforms including ‘TV Everywhere’ and pay-TV video-on-demand (VOD) are showing promising in-market results, they are still relatively nascent and taking shape in a business landscape known for changing very slowly. “It’s like turning a supertanker while you are rebuilding it,” says Niemeyer. “It takes a long time to take new platforms from first in-market trials to fully-realized revenue-generating ecosystems. There will be revenue winners and losers during the next five years, but the total TV/video dollar pool will stay the same.”

According to Niemeyer, “Even as they implement ‘TV Everywhere’ and VOD, operators and content providers have to make key decisions now about going forward on new advanced techniques and technologies. These will be critical for long term growth, but will not begin to generate significant revenues until after 2020.”

 

 

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