VOD to generate over US$10bn by 2012, according to report

February 29, 2008 – A new report from Informa Telecoms & Media forecasts that by 2012, 909mn homes will have access to true video-on-demand (VOD) or near-video-on-demand (NVOD) technology, representing 78% of the world’s TV homes and generating revenues in excess of US$10bn.

The report, entitled “On-Demand TV & PVRs”, projects that North America and Europe will account for a combined 83% of global on-demand revenues by 2012, with North America out front holding a share of close to 50%.  Last year, North America accounted for 56% of global VOD revenues but just 25% of worldwide VOD/NVOD users.  The report forecasts that the Asia Pacific region will account for over half of on-demand homes by 2012 but take under 12% of global revenues.

Global on-demand revenue forecasts by region

Source: Informa Telecoms & Media

In Europe, the UK is the leading country for on-demand and is predicted to generate $677mn in 2012, with France and Germany some way behind in second and third places respectively.  The Informa research adds that operators are continuing to demonstrate the importance of on-demand services by the fact that they are making ongoing investments in expensive upgrades to their networks in preparation for widespread on-demand activity.

“While true VOD operators still use a free-content model to promote high customer awareness of the technology, there are now signs that these services are successfully converting users into revenue-generators,” said Adam Thomas, author of the report.  “This is often at the expense of NVOD services, which are either being phased out, or reduced in size.”