MOST POPULAR

News

North American OTT market forecast to grow 21% in 2014

 

Consumer use of subscription video-on-demand services, such as Netflix and Hulu, will be the biggest driver in “over-the-top” video revenues growing 21% this year in North America, reaching $10.7 billion – according to research and consulting firm, Strategy Analytics.

OTT revenues are forecast to double between 2013 and 2019 to $18.0 billion. Subscription video-on-demand revenues will grow 26% in 2014 to $5.1 billion – accounting for 48% of total “over-the-top” (OTT) video revenues. OTT refers to TV and film content delivered over the Internet, rather than from a cable or satellite company.

Retail sales (i.e. downloading to own) will grow 13% to $1.4 billion (13% of OTT revenue) while renting (i.e.streamed/temporary downloads) will grow 21% to $681 million (6% of revenue).

Advertising around OTT content, such as video ads, will account for the remaining 33% of revenues in 2014, growing by 17% to $3.6 billion.

“Subscription services are the lifeblood of the OTT video industry,” says Michael Goodman, Director, Digital Media for Strategy Analytics. “An extensive library of TV shows and movies – with just enough blockbuster titles – at an affordable price has proved a compelling cocktail for consumers.”

“Barring a totally unexpected collapse, Netflix has won the battle for supremacy in this sector, accounting for about three-quarters of subscription video revenue in North America. With its momentum only growing, the other services, such as Hulu, HBO Go, YouTube and Amazon, are left to fight over the scraps.”

The average North American broadband user will spend almost $29 on OTT services in 2014, up 18% from 2013. By 2019, this will have increased 78% from 2013 to $43.51.

Between 2013 and 2019, subscription revenues will grow 116% to $8.8 billion. Retail sales will grow 58% to $1.9billion, while renting will grow 74% to $980 million. Advertising revenue will increase 109% to $6.4 billion.

Goodman concluded: “It’s amazing to think people spent almost half as much on internet film/TV content last year, such a new industry, as they did on DVDs – a format that’s been around for 20 years. By the end of this year there’ll be about 54 million subscriptions to over-the-top video services such as Netflix, Hulu and MLB.com. In five years this will reach about 69 million – at which point OTT revenues will have overtaken DVDs.”

We welcome reader discussion and request that you please comment using an authentic name. Comments will appear on the live site as soon as they are approved by the moderator (within 24 hours). Spam, promotional and derogatory comments will not be approved

Post your comment

Facebook, Instagram and Sky case study: Game of Thrones

BT at IBC: 'unlocking the power of fibre IPTV'

IP&TV News tries out 4G Broadcast at the FA Cup Final

Thomas Riedl: “Google TV has evolved into Android TV”

Tesco and blinkbox: what went wrong?

Reed Hastings and 2030: is he right?