SVOD, ad revs to drive OTT to more than $200BN by 2024 | Media Analysis | Business
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A study by tech market advisory firm ABI Research is predicting that fuelled by subscription and advertising revenue, and boosted by the new direct-to-consumer plays, the global over-the-top market will surpass US$200 billion by 2024.
AppleTV 29Jan2020
Indeed, the OTT and Multiscreen Video and Digital Content market data report found that advertising and recurring revenues from subscription video-on-demand (SVOD) will account for as much as 90% of that value with new DTC services such as Disney+ and Apple TV+, coupled with aggressive pricing and packaging, and continued expansion by incumbents, pushing the market to new heights. ABI noted that subscriptions in the Asia-Pacific region have grown significantly, driven by key services in China like iQIYI/Baidu, Tencent and Youku Tudou/Alibaba Group. There were also increasing opportunities in India.

Overall, the analyst believes that the ongoing shift to OTT is creating value for companies throughout the video value chain, including pay-TV operators. It adds that expansion of new technologies, like 5G, will further present the market with new opportunities.

Cord-cutting is often regarded as a consequence of expanding OTT consumption, but the market dynamics are more complex, particularly when one considers how the pay TV industry has embraced OTT as a complement and value-additive, rather than strict competition,” commented Michael Inouye, Principal Analyst at ABI Research. “Over time, we expect the traditional pay-TV offer to continue to evolve and become indistinguishable from a pure OTT package of services.

The OTT and Multiscreen Video and Digital Content market data report did though put the OTT push into context. It noted that even with over 700 million OTT SVOD subscriptions in 2019, the pay-TV market, with over 1 billion subscriptions, was still larger. Furthermore, while growth rates are slower, and even declining in North America, the overall market is still expanding. ABI also observed that the attention paid to low latency video was testament to how OTT video was growing but also highlighted the ongoing opportunities with live/linear programming.

“Increasingly, we’re seeing more solutions and conversations about bringing content and services together,” Inouye added. “This includes pay-TV and OTT bundles and extends to cross-platform advertising, analytics, and customer/service management. Ultimately it makes the market more accessible to a wider range of companies and expands the potential video touchpoints, particularly as new technologies like 5G, smart home, and augmented/virtual reality play larger roles.”